At the start of the European trading session, gold (XAU/USD) continues to show solid intraday declines, partially offsetting the moderate recovery momentum recorded the previous day after rebounding from the $4,450 level. The "hawkish" minutes of the FOMC (Federal Open Market Committee) meeting published on Wednesday confirmed market expectations regarding a possible interest rate increase before the end of the year. This is supporting the U.S. dollar, which remains near six-week highs, putting pressure on gold as a non-yielding asset.

At the same time, the decline in prices remains limited, as market participants remain cautious while awaiting further clarity on the situation in the Middle East, where conflicting signals continue to emerge regarding the prospects of a peace agreement between the United States and Iran. The minutes from the Federal Reserve's April 28–29 meeting showed that most officials consider further monetary tightening justified if inflation remains above the 2% target level. Overall, committee members noted that inflation risks are skewed to the upside, while geopolitical tensions could significantly affect the balance of risks and complicate future monetary policy decisions.

According to the CME Group's FedWatch Tool, the market estimates the probability of a 25-basis-point rate hike in 2026 at more than 50%. Such "hawkish" expectations are helping to limit the corrective weakening of the dollar observed during the Asian session, which had been driven by growing hopes for de-escalation in the conflict with Iran. In particular, on Wednesday, U.S. President Donald Trump stated that negotiations with Iran were in their final stage. Vice President J.D. Vance also gave an optimistic assessment, pointing to Tehran's willingness to reach an agreement. These statements improved risk appetite, somewhat weakening the dollar's position as a safe-haven asset and supporting gold prices.

Nevertheless, positive expectations remain limited amid Trump's warnings about the possible use of military force if negotiations fail. Iran, in turn, reacted sharply to such statements, warning of the risk of large-scale escalation in the event of renewed attacks by the United States or Israel. In addition, investors remain skeptical about the prospects for an agreement due to deep disagreements over Tehran's nuclear program and tensions surrounding the strategically important Strait of Hormuz.

The situation is further aggravated by reports that Iran has established a new "Office for Persian Gulf Strait Affairs," which will oversee shipping in this key region. This maintains elevated geopolitical risks, limiting the downside potential for the dollar while also restraining sustained growth in gold prices, forcing buyers to remain cautious.

From a technical perspective, XAU/USD continues to maintain a moderately bearish tone. The 14-period Relative Strength Index (RSI) remains negative, although it still signals neutral to weak momentum. At the same time, the MACD indicator is also negative, confirming the bearish sentiment.

If growth continues, the nearest resistance is located at the 20-day SMA. On the other hand, the psychologically significant $4,500 level remains the key reference point and the nearest support.