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Gold Prices Fall from Six-Year High as Traders Enter Wait-and-See Mode

Investing.com - Gold prices fell on Tuesday in Asia, easing from the highest level in more than six years following the knee-jerk reaction toward news of escalating U.S.-Iran tensions.

Gold Futures traded 0.5% lower to $1,560.75 by 11:13 PM ET (03:13 GMT).

Gold prices have rallied more than 2% over the past two days, driven by increasing safe-haven demand amid U.S.’s standoff with Iran.

The fall in prices of the safe-haven metal today came despite reports that the U.S. has committed more troops to the Mideast and speculations that Tehran will retaliate for the U.S. airstrike that killed General Qassem Soleimani last week.

Meanwhile, global equities rebounded today, with Chinese stocks gaining almost 1% in morning trade.

“Geopolitical tensions remain centre stage with markets clearly in wait-and-see mode,” Tapas Strickland, director of economics and markets at National Australia Bank, wrote in a note on Tuesday.

“The potential for this to spiral into a cycle of retaliation remains and markets will likely remain cautious,” Strickland said, referring to U.S.-Iran tensions.

Traders are also focused on the upcoming U.S. job report due on Friday and the Federal Reserve’s monetary policy path into 2020. Fed officials including Richard Clarida, John Williams, James Bullard and Charles Evans will speak on Thursday.

On the Sino-U.S. trade front, Washington and Beijing are expected to sign a phase one trade deal on Jan. 15, according to reports citing people familiar with the matter.

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