Gold slid to a two-week low on Tuesday as the U.S.-Iran conflict in the Gulf sent oil prices soaring and fuelled inflation fears, with hawkish remarks from Federal Reserve Governor Christopher Waller further reinforcing bets on higher U.S. interest rates.

FUNDAMENTALS

Spot gold was down 0.2% at $3,993.83 per ounce by 0110 GMT, having shed about 3% in the previous session ‌in its biggest ⁠daily percentage ⁠decline in more than a month. U.S. gold futures for August delivery were steady at $4,000.70.

The U.S. military carried out a third consecutive night of strikes against Iran on Monday and two tankers came under fire in the Strait of Hormuz, after U.S. President Donald Trump said Washington was reinstating its blockade of Iranian shipping in the Gulf.

Oil futures hit their highest point since mid-June, ⁠having surged about 9% ‌in the previous session, while U.S. Treasury yields and the dollar climbed as the conflict between the United States and Iran re-ignited ⁠over the weekend.

Investors will closely watch June U.S. CPI data due later in the day for fresh clues on inflation and the Fed’s policy path, with PPI data and Fed Chair Kevin Warsh’s first semiannual testimony before Congress this week also in focus.

The U.S. central bank may need to raise interest rates “in the near term” if coming data show inflation continuing well above the 2% target, Waller said on Monday, ‌in remarks that characterized monetary policy as being at a “crossroads.”
Traders have ramped up bets on a September U.S. interest rate hike, with CME Group’s FedWatch Tool showing ⁠the probability rising to around 78% from 57% a week ago.
The European Union announced on Monday new sanctions against Sudan by targeting the country’s gold trade, which it said was being used to finance the military conflict in the country.
Elsewhere, spot silver declined 1.2% to $56.98 per ounce, having earlier touched a two-week low.

Platinum fell 1% to $1,589.35 and palladium eased 0.4% to $1,242.54.

DATA/EVENTS (GMT)

1230 US Core CPI MM, SA June

1230 US Core CPI YY, NSA June

1230 US CPI MM, SA June

1230 US CPI YY, NSA June

1230 US CPI Wage Earner June : China Exports, Imports YY June : China Trade Balance USD June

The dollar steadied on Tuesday ahead of U.S. inflation data, with Middle East tensions lifting oil prices while the yen held a soft tone amid caution over possible intervention and after policymakers’ comments on state pension fund allocations.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, was flat at 101.27.

Inflation risks remain in the spotlight with the release of U.S. June CPI data on Tuesday, June PPI gauges the following day, and Fed Chair Kevin Warsh’s first semiannual testimony ‌before Congress.

Concerns over ⁠escalating tensions ⁠between the United States and Iran returned to the fore, with President Donald Trump saying on Monday Washington was reinstating a naval blockade on Tehran and would ensure the Strait of Hormuz remained open for a fee following fresh exchanges of missile and drone strikes.

U.S. and Iranian forces exchanged heavy missile and drone assaults at the weekend, with Tehran striking U.S. facilities in states across the Gulf on Sunday and saying it had again closed the vital Strait of Hormuz shipping route.

Oil prices rose more than 9% to a one-month high on Monday. Both U.S. West Texas Intermediate and Brent crude futures rose more ⁠than 2% ‌to their highest since mid-June in early Tuesday trading.
The euro was stable against the dollar at $1.1383 and sterling traded at $1.3347. Meanwhile, Federal Reserve Governor Christopher Waller said rates may need to rise “in the near term” if data ⁠shows inflation remaining well above the central bank’s 2% target.

A core CPI reading of 0.3% or higher would likely imply, depending on PPI data due later in the week, that the Fed’s preferred core PCE deflator is also running at 0.3% or above, said Ray Attrill, head of FX strategy at National Australia Bank, in a podcast.

“That may well be a trigger for a Fed rate hike as early as the July meeting,” Attrill said.

Economists’ median estimate for the June core CPI was 0.2% growth month-on-month.

Fed funds futures are pricing in about 30 basis points of rate hikes by the U.S. central bank this year, according to LSEG data.YEN UNDER ‌PRESSURE AGAIN

The Japanese yen was roughly flat against the greenback at 162.40 per dollar, putting traders back on alert for possible intervention from authorities in Tokyo as the Japanese currency continues to languish at 40-year lows.

“Japanese authorities appear to have softened their tolerance ⁠a touch, though they remain vigilant and have indicated that further forceful intervention is on the cards should we see another dramatic move from here,” said Matthew Ryan, head of market strategy at Ebury, a British payment firm.

The Japanese yen slipped against the dollar on Monday after Reuters reported that Tokyo had no imminent plans to change the asset allocations of its state pension funds, tempering expectations of near-term support for domestic assets.

The yen and Japanese bonds had rallied on Friday after Finance Minister Satsuki Katayama said the government would seek ways to encourage pension funds, including the Government Pension Investment Fund, to make greater investments in Japanese financial assets.

The Australian dollar last traded at $0.6915 versus the greenback. New Zealand’s kiwi gained 0.24% versus the dollar to $0.5762.

In cryptocurrencies, bitcoin rose 0.23% to $62,293.66. Ether was up 0.56% at $1,775.54.

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Oil extended gains and Treasuries edged lower after the standoff between the US and Iran intensified, raising concern that supply disruptions will reignite inflation and strengthen the case for higher interest rates.

Brent climbed as much as 2.8% to $85.64 a barrel. The commodity had jumped 9.6% on Monday — its biggest gain since May 2020 — after President Donald Trump reinstated the US blockade of Iranian ships transiting the Strait of Hormuz and demanded a 20% reimbursement on all other cargo shipped through the waterway.

Treasuries slipped as traders saw a US interest-rate hike later this month as a coin toss, ahead of Tuesday’s US consumer price index data. Money markets priced in about 50% odds of a Federal Reserve hike in July as Governor Christopher Waller said officials may need to raise rates to tame price pressures. Gold and silver retreated.

Asian shares were mixed with MSCI’s gauge of regional equities fluctuating between small gains and losses. South Korean stocks were volatile, rising as much as 0.6% and dropping up to 2.8%. The chip sector remained in focus after SK Hynix Inc.’s American depositary shares fell 9.3% as an AI-fueled stock rout in South Korea spilled over into the US market. US equity-index futures also retreated.

The latest wave of attacks between the US and Iran dashed hopes for a near-term normalization of traffic through the Strait of Hormuz. The escalation adds another layer of uncertainty ahead of a pivotal week for markets, with earnings season kicking off alongside US inflation data and Fed Chair Kevin Warsh’s congressional testimony, both seen as key to the outlook for interest rates.

“The energy sector is once again in the limelight as the status of the Strait of Hormuz is driving price action in global markets,” said Ian Lyngen at BMO Capital Markets. “There is a growing sense that the situation is likely to get worse before it de-escalates.”
The flare-up comes as investors are increasingly questioning whether the enormous sums being poured into artificial intelligence will generate commensurate returns.An AI-fueled stock rout in South Korea on Monday spilled over into the US market, underscoring concerns that the boom has become overextended. The selloff on the Kospi index is the latest sign of how volatile the Korean market has become after the AI rally drove massive outperformance versus global peers.

“Uncertainty around the Middle East continues, but we think the AI wave is what will drive markets over the next few weeks, especially as earnings season kicks off,” said Sonu Varghese at Carson Group.

Investors are now turning their focus to US inflation data after Waller said policymakers may need to raise rates in the near term if underlying inflation continues to signal broad price pressures.

Treasury two-year yields, which are relatively sensitive to changes in Fed policy expectations, edged up one basis point to 4.29%, the highest since February 2025. The benchmark 10-year yield climbed to 4.63%, the highest since May.

The surge in short-term yields reflects growing expectations that the Fed will need to raise rates sooner to rein in price pressures from the rebound in global energy prices and signs of a resilient US economy.

In data due Tuesday, the consumer price index is expected to slow to 3.8% in the year through June, from 4.2% in May, according to a Bloomberg survey of economists. Warsh will also make his first appearance before Congress as Fed chair.

“If we get another hot reading on core inflation this week, then the FOMC will need to consider tightening monetary policy in the near term,” Waller said Monday, referring to the central bank’s rate-setting committee.

The Thailand Board of Investment (BOI) has approved seven major data center and hosting projects, highlighting the nation’s dedication to advancing its digital infrastructure.

Chaired by Deputy Prime Minister and Minister of Finance Mr. Ekniti Nitithanprapas, the decision aims to position Thailand as a premier Digital Innovation Hub within ASEAN, addressing the increasing demand for robust and reliable digital services.

These strategic investments are crucial for accelerating Thailand’s digital transformation. By building secure and high-performance data capabilities, we are fulfilling the rising demand and enabling businesses to innovate and prosper, both domestically and across the region.

Mr. Narit Therdsteerasukdi, Secretary General of the Thailand Board of Investment (BOI).

These newly approved projects collectively represent a substantial investment exceeding USD 3.1 billion (THB 96.88 billion) and signify a major leap in technological advancement for Thailand. The BOI’s Secretary General, Mr. Narit Therdsteerasukdi, emphasized that these strategic investments are crucial for accelerating Thailand’s digital transformation by building secure and high-performance data capabilities to meet rising demand and enable business innovation.

The approved projects include:

• True Internet Data Center Co., Ltd.: Three data center projects with a total investment of approximately USD 1.4 billion (THB 45.3 billion), offering a combined IT load of 223 MW, situated in Chonburi and Samut Prakan.
• GSA Data Center 05 Co., Ltd.: Two projects amounting to roughly USD 1.2 billion (THB 37.2 billion), located at WHA Eastern Seaboard Industrial Estate 5 (Rayong) and in Samut Prakan, with a combined IT load of 120 MW.
• Stellar DC Co., Ltd.: A single project totaling USD 0.3 billion (THB 8.1 billion), developed by STECON Group in collaboration with SC Zeus Data Centers (Singapore), located in Bangkok and supporting a 25 MW IT load.
• Freyr Technology (Thailand) Co., Ltd.: A Singapore-based entity investing USD 0.2 billion (THB 6.3 billion) in a data hosting project, with facilities planned for Rayong and Samut Prakan.

These approvals build upon a strong foundation from the previous year, as the BOI received a cumulative total of 36 data center projects in 2025, representing an investment value exceeding USD 23.1 billion (THB 728 billion). These facilities are distributed across key provinces including Bangkok, Chachoengsao, Chonburi, Pathum Thani, Rayong, and Samut Prakan.

The expected benefits from these data center projects are multifaceted:

• Job Creation: They are anticipated to generate numerous highly skilled jobs for Thai professionals in critical technology sectors.
• Sustainability: The sector’s focus on high-efficiency “Green Data Centers” aligns with global sustainability trends and Thailand’s commitment to responsible development.
• Economic Ecosystem: These widespread investments will foster a robust domestic supply chain, encompassing infrastructure providers, hardware manufacturers, facility management services, and a thriving ecosystem of online businesses across e-commerce, fintech, and AI.
• Digital Sovereignty: Expanding domestic data center capabilities will ensure faster data access (low latency), bolster cybersecurity, and strengthen data sovereignty, making Thailand an even more attractive destination for global digital players and solidifying its role as a true Digital Innovation Hub for ASEAN.

The newly approved data center projects are designed to facilitate Thailand’s regional leadership as a ‘Digital Innovation Hub in ASEAN’ through several key avenues beyond simply increasing computational capacity. These strategic investments, totaling over USD 3.1 billion, are deemed crucial for accelerating Thailand’s digital transformation and enabling businesses to innovate and prosper both domestically and across the region.

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