Gold Gains As Dollar Rally Stalls

(RTTNews) - Gold prices traded higher on Tuesday as the dollar extended an overnight decline on hopes of an easing of tensions in the U.S.-Iran conflict.

Spot gold rose by 0.9 percent to $5,183.23 an ounce while U.S. gold futures were up 1.8 percent at $5,194.44.

The dollar took a breather and bond yields tumbled after U.S. President Donald Trump said the war with Iran may not last that long.

Trump told CBS News that he thinks "the war is very complete, pretty much and they have nothing left in a military sense." Trump also added that he's thinking about taking over the Strait of Hormuz.

Trump's comments spurred hopes for a potential resolution to the U.S.-Israeli war on Iran.

However, tensions prevail, with Israel launching waves of airstrikes in retaliation for a barrage of Hezbollah rockets and missiles.

Iran launched new barrages of missile and drones at Gulf Arab states hosting U.S. military bases and Israel as supporters of the Islamic Republic staged rallies to celebrate the appointment of a new hardline leader, Mojtaba Khamenei, son of former Supreme Leader Ali Khamenei.

Iran's Revolutionary Guards have issued a stern warning, saying they would not allow "one liter of oil" to be shipped from the Middle East if military strikes by the U.S. and Israel continue.

"If Iran does anything that stops the flow of Oil within the Strait of Hormuz, they will be hit by the United States of America TWENTY TIMES HARDER than they have been hit thus far," Trump said in a social media post.

In economic releases, traders await a key batch of U.S. economic data later this week, including the January consumer price index report scheduled for release on Wednesday and the February personal consumption expenditures price index due on Thursday for additional clues on the Fed's rate trajectory in the coming months.