09:08 AM EDT, 05/11/2026 (MT Newswires) -- Gold traded lower early Monday as the dollar and yields rose after the United States rejected Iran's response to its peace plan offered last week, calling the country's response unacceptable.

Gold for June delivery was last seen down $34.20 to US$4,696.50 per ounce.

Iran replied to a U.S. peace offer made last week with a plan of its own, delivering a response on Sunday that included demands for compensation for war damages, acknowledgement of its control of the Strait of Hormuz, an end to Israel's war on Lebanon and the removal of sanctions on its oil exports and nuclear enrichment program.

Iran's demands were dismissed by U.S. President Trump. who called the demands "totally unacceptable" in a social media post.

The war, now in its tenth week, has boosted inflation as energy costs rise, with the blockade of the Strait of Hormuz keeping exports of 20% of daily oil demand supplied by Persian Gulf nations from the market. The threat of rising costs forcing central banks to raise interest rates has sent traders to the U.S. dollar and bonds, keeping gold rangebound.

"Gold trades lower after Donald Trump rejected Iran's latest proposal, lifting both the dollar and U.S. bond yields....Overall, gold remains rangebound, with support established ahead of US$4,500, while resistance is seen at the 50-day moving average, currently near US$4,768."

The dollar rose early, with the ICE dollar index last seen up 0.8 points to 97.98. Treasury yields also rose, with the U.S. two-year note last seen paying 3.922%, up 2.7 basis points, while the yield on the 10-year note was up 2.9 points to 4.386%.