Summary

(RTTNews) - Gold prices have traded little changed on Monday after the U.S. rejected Iran's response to its proposal for ending the gulf war, sending oil prices higher and renewing inflation concerns. Front Month Comex Gold for June month delivery has ticked lower by $0.20 (or 0.01%) to $4,730.50 per troy ounce. Front Month Comex Silver for June month delivery has catapulted by $5.254 (or 6.52%) to $85.835 per troy ounce. The U.S.-Israel versus Iran war that began on February 28 has led to the closure of the Strait of Hormuz, and as a result, crude oil supply disruption is exerting tremendous inflationary pressure on global economies. While Iran closed the strait soon after the war broke out, U.S. forces implemented a naval blockade on all ships trying to enter or exit Iranian ports. Despite a two-week ceasefire announced by Trump early in April that was extended by him for an indefinite period, a mutual compromise to end the war through negotiations remains elusive. The twin-blockade and the resultant rise in oil prices is continuing to shatter business confidence across the world. Last week, the U.S. handed Iran a 14-point peace plan and reports indicated that both nations were closing in on a Memorandum of Understanding. After announcing an initiative (termed Project Freedom) to escort the stranded vessels in the Strait of Hormuz, safely out of the region with the U.S. navigational guidance, Trump withdrew the operation in less than 36 hours of announcement. Trump stated that the U.S. and Iranian negotiations were making good progress and added that a deal could happen anytime soon. After a couple of days of reviewing the U.S. proposal, Iran sent its counter-proposal to the U.S. through Pakistan. According to Iran's semi-official Tasnim news agency, primarily Iran had sought the lifting of U.S. sanctions, ending the naval blockade enforced by the U.S. on Iranian ports, and an immediate end to the U.S.-Israeli attacks on Iran. Through Truth Social, Trump stated that after reading the response from Iran's representatives, he felt it was "totally unacceptable" without elaborating on what were the points of disagreement. Iran's Foreign Ministry spokesperson stated that the U.S. is continuing to add pressure with "unreasonable demands" though Iran's response to the U.S. was "not excessive." In a separate post, Trump stated that Iranians have been "tapping" the U.S. for nearly 47 years which he will not let no longer happen. A summit between Trump and Chinese President Xi Jinping is slated to be held in Beijing, China on May 14-15. Since China has strong economic ties with Iran, the reopening of the strait could be a priority on the agenda of discussions. Economists are now anticipating that the U.S.-China talks could offer positive results to defuse the crisis. Data released by the National Association of Realtors revealed that in the U.S., the existing home sales inched higher by 0.2% from the seven-month low of the previous month to an annualized rate of 4,020,000 units in April. Consumer and whole-sale inflation numbers are scheduled to be released this week. In the Middle East, Israel continued to bombard Lebanon despite a ceasefire announced by Trump weeks before, adding to the Middle East tensions. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.