International precious metals markets experienced a significant correction on Tuesday, with gold prices dipping to recent lows. Spot quotations fell to approximately $4,606.6 per ounce, representing a decline of nearly 1.7%, while futures contracts moved lower in tandem. Market sentiment was weighed down by multiple factors, with geopolitical tensions serving as a primary catalyst. Reports indicate that the U.S. expressed dissatisfaction with Iran's proposed plan to end the conflict, suggesting that the blockade status of the Strait of Hormuz may prove difficult to resolve. This uncertainty has reignited pessimistic expectations regarding the Middle East peace process while simultaneously driving up energy costs.
Volatility in the energy sector further exacerbated inflation concerns. The United Arab Emirates confirmed through its national news agency that it will officially withdraw from the Organization of the Petroleum Exporting Countries (OPEC) and the OPEC+ alliance on May 1, concluding nearly 59 years of membership. Anticipation of lifted production constraints propelled oil prices to rebound sharply on the day, with Brent crude surging more than 3% to break through the $110 threshold, and U.S. domestic crude prices also crossing the key integer level. Analysts noted that ahead of the Federal Reserve's imminent policy meeting, soaring oil prices combined with supply chain disruption concerns prompted capital to temporarily exit the gold market.
Regarding the trajectory of monetary policy, investors widely anticipate that the Federal Reserve will maintain interest rates unchanged following the two-day meeting, keeping the target range locked between 3.5% and 3.75%. Market focus remains centered on the Federal Reserve Chair's post-meeting remarks, which are regarded as his final public appearance during his tenure. Several economic experts have analyzed that due to the uncertain duration of energy transport disruptions, coupled with previous inflation data indicating upward pressure, the likelihood of the central bank adjusting interest rates in the near term is minimal. Some perspectives even suggest that rates could remain stable throughout the entire coming year.
Beyond gold, other precious metal categories also failed to escape the downturn, with spot prices for silver, platinum, and palladium registering declines of varying magnitudes. On the global demand front, the latest trade data reveals that China's net gold imports from Hong Kong in March increased month-on-month, sustaining a strong inflow trend. Concurrently, global investors are also directing their attention toward policy decisions from other major central banks scheduled within this week, including the European Central Bank, the Bank of England, and the Bank of Canada, to gauge subsequent shifts in the global liquidity environment.
