Gold falls as Mideast escalation dims hopes of easing inflation

Gold prices fell on Thursday as the escalating Middle East conflict showed no signs of abating, erasing recent optimism over easing inflation and fuelling concerns that surging oil prices could lead to interest rate hikes. Spot gold was down 0.6% at $4,034.42 per ounce by 0349 GMT. US gold futures for August delivery lost 0.3% to $4,039.90. “Gold is declining as the escalating attacks in the Middle East continue to push oil prices sharply higher this week, keeping concerns about inflation alive,” said Jigar Trivedi, a senior research analyst at IndusInd Securities. Oil prices extended gains to a fourth session as the US launched two waves of attacks on Iran’s coastal defences and missile sites after re-imposing a naval blockade of its ports. Iran struck back by targeting US military sites in neighboring countries in what it called an “existential war” with America.