Markets remain cautious as US–Iran talks continue, gold holds firm, USD steady

US–Iran geopolitics: Talks continue amid unresolved tensions

Recent developments show that the United States and Iran are maintaining diplomatic channels and considering additional rounds of negotiations. The primary objective is to extend the current ceasefire and move toward a more stable long-term agreement. However, key disagreements remain unresolved, leaving the ceasefire fragile. As a result, markets remain in a “wait-and-see” mode, highly sensitive to any new geopolitical headlines.

USD: Holds steady around the 105 level

The U.S. Dollar Index (DXY) traded around 104.8–105.4, reflecting a stable dollar environment. Elevated U.S. Treasury yields continue to support the dollar, while the market lacks strong catalysts to drive a clear directional move.

The Federal Reserve’s “higher for longer” policy stance remains a key pillar supporting USD strength.

Gold: Holds above 4800

Gold (XAU/USD) remained above the 4800 level, indicating that safe-haven demand is still intact. Despite signs of renewed negotiations, investors have not significantly reduced defensive positioning, suggesting that uncertainty remains elevated and geopolitical risks are still being priced in.

Oil: Stabilizes below 100 USD

Brent crude oil traded in the 95–99 USD/barrel range, indicating that most of the geopolitical risk premium has been priced out. However, the fact that oil prices have not declined further suggests that the market is still retaining some level of risk amid ongoing uncertainty.

EUR & GBP: Range-bound trading

EUR/USD and GBP/USD continued to trade within narrow ranges due to the lack of strong macroeconomic catalysts. The stability of the USD limits upside momentum for both currencies.

JPY: Remains under pressure

The Japanese yen remained under pressure as interest rate differentials with the U.S. persist, keeping USD/JPY elevated. Despite its safe-haven status, JPY has yet to show a strong recovery.

Market Overview

The market is currently in a cautious and range-bound phase, where gold holding above 4700 reflects sustained safe-haven demand, oil remaining below 100 USD signals that much of the geopolitical risk premium has eased, and the U.S. dollar stays stable on the back of elevated yields, as investors simultaneously price in both the continuation of diplomatic talks and the lingering risk of renewed conflict between the United States and Iran.

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