Gold Tumbles On Inflation Fears

(RTTNews) - Gold prices were sharply lower on Monday while the dollar index advanced as a lack of progress in the U.S.-Iran peace talks sent oil prices soaring and revived inflation fears.

Spot gold fell 1.2 percent to $4,659.22 an ounce while U.S. gold futures were down 1.4 percent at $4,666.80.

Brent crude prices jumped above $105 a barrel after the United States and Iran failed to agree on a pace deal, keeping the Strait of Hormuz largely closed and raising doubts about the durability of a fragile ceasefire.

After U.S. President Donald Trump rejected Iran's latest proposal to end the months-long conflict now stretching over two months, Iran said it would continue using both "the weapon of diplomacy" and military resistance whenever it considers necessary to protect national interests.

Iranian Foreign Ministry spokesperson Esmaeil Baqaei said the U.S. has committed a breach of trust in every diplomatic process it has participated in over the past 20 years.

Israeli Prime Minister Benjamin Neanyahu said that Iran's stockpile of enriched uranium must be "taken out" before the conflict with Iran can be considered over.

Earlier, Iran rejected the U.S. proposal for renewed peace talks, calling it "surrender" and insisting instead on war reparations, full Iranian sovereignty over the Strait of Hormuz, sanctions relief, and the release of seized assets.

The response also called on the U.S. to end its naval blockade and guarantee no further attacks.

Looking beyond the tensions in the Middle East, investors also await cues from an upcoming meeting between Donald Trump and Xi Jinping, the Fed's leadership transition and the release of U.S. inflation data.

Trump will meet with his counterpart Xi Jinping for a two-say summit starting Thursday. May 15 marks Jerome Powell's final day as chair of the Federal Reserve, though he'll remain on the board of governors.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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