XAU/USD, XAG/USD Slip as Iran Deal Optimism Eases Safe-Haven Demand

Gold and silver declined during the Asian session on Monday as growing optimism around a potential Iran nuclear deal tempered safe-haven demand, even as the US conducted active military strikes near the Strait of Hormuz. XAU/USD slipped lower alongside XAG/USD as markets priced in a possible diplomatic resolution to tensions in the Persian Gulf, a critical chokepoint for global oil flows. The interplay between geopolitical risk from ongoing US strikes and de-escalation hopes from advancing negotiations created a complex backdrop for Asia-Pacific FX markets. Risk-sensitive currencies in the region likely found modest support from the improved diplomatic outlook, while traditional safe havens such as the Japanese yen and Swiss franc faced reduced demand. Oil prices remained a key variable, as any resolution at the Strait of Hormuz would ease supply concerns and reduce commodity-driven inflation pressures. Traders should monitor developments in the Iran deal closely, as a breakdown in talks could rapidly reverse current positioning. Near-term, the balance between active military engagement and diplomatic progress will dictate direction across FX and commodity markets.