Gold prices fell in Asian trade on Tuesday, retreating from record highs as some easing uncertainty over Iran cooled safe haven demand for the yellow metal, while pressure from concerns over U.S. interest rates persisted. 

Among industrial metals, a rally in copper, to record highs, also reversed course on Tuesday amid some profit-taking, and as traders gauged just how much potential the red metal had this year. 

Gold surged to a record high on Monday, benefiting from increased safe haven demand as traders feared some geopolitical instability in the Middle East after Iran’s President was killed in a helicopter crash. But the immediate impact of his death remained unclear. 

Spot gold fell 0.5% to $2,413.77 an ounce, while gold futures expiring in June fell 0.9% to $2,416.75 an ounce by 00:59 ET (04:59 GMT). Spot gold hit a record high of nearly $2,450 on Monday. 

Gold stalls as safe haven demand ebbs, rate fears persist

The lack of any major instability in the Middle East sapped safe haven demand for gold, leaving it more vulnerable to concerns over U.S. interest rates.

A string of Federal Reserve officials warned on Monday that the central bank needed much more convincing that inflation was easing before it could begin trimming interest rates. The central bank is likely to keep rates high for longer.

The dollar firmed as markets now positioned for the minutes of the Fed’s late-April meeting, due Wednesday, which in turn pressured broader metal prices and cut short a rally in prices.

High-for-long interest rates diminish the appeal of non-yielding assets such as gold by increasing the opportunity cost of investing in them.

Other precious metals also sank on Tuesday. Platinum futures fell 1.6% to $1,042.60 an ounce, while silver futures fell 2.5% to $31.628 an ounce. But both metals retained a bulk of their gains made through the past few sessions.

Copper comes off record highs

Copper prices retreated sharply from record highs made on Monday, as investors stepped back to see just how much potential the red metal had this year. 

Copper’s recent rally was sparked chiefly by a speculative frenzy over a potential supply deficit of the red metal, which in turn had caused a short squeeze on the Comex exchange and triggered even more gains. 

But these gains were seen cooling on Tuesday, with focus on whether copper shipments could be sourced in time to meet immediate demand. 

Three-month benchmark copper futures on the London Metal Exchange fell 1.3% to $10,825.0 a ton, after hitting a record high above $11,100 on Monday.

One-month U.S. copper futures fell 1.1% to $5.0510 a pound, also retreating from record highs.