Gold prices fell to a near one-week
low on Monday, pressured by a stronger dollar, while a surge in
oil prices following failed U.S.-Iran peace talks fuelled
inflation worries and dampened expectations for Federal Reserve
interest rate cuts this year.
Spot gold was down 0.6% at $4,718.98 per ounce, as of
0222 GMT, after hitting its lowest level since April 7 earlier
in the session. U.S. gold futures for June delivery fell
1% to $4,742.
The dollar strengthened 0.4% while oil prices jumped above
$100 a barrel, as the U.S. Navy prepared a blockade of the
Strait of Hormuz that could restrict Iranian oil shipments after
the U.S. and Iran failed to reach a deal to end the war.
Iran’s Revolutionary Guards responded by warning that
military vessels approaching the Strait will be considered a
ceasefire breach and dealt with harshly and decisively.
“Ceasefire optimism has unwound following the failure of the
peace talks, and the resulting push higher by the dollar and oil
prices has put gold on the back foot again,” said Tim Waterer,
chief market analyst, KCM Trade.
Spot gold has fallen more than 11% since the U.S.-Israeli
war on Iran began on February 28.
“As soon as oil prices push back above $100, attention
quickly turns to potential central bank rate hikes to curb
inflation, and it is this interest rate outlook which is
undermining gold’s performance,” Waterer said.
Traders now see little chance of a U.S. rate cut this year,
as higher energy prices threaten to feed into broader inflation
and limit the scope for monetary easing.
Before the war in the Middle East began, there were
expectations for two Fed rate cuts this year.
While inflation typically boosts gold’s appeal as a hedge,
elevated interest rates weigh on the non-yielding metal. A
stronger dollar makes greenback-priced bullion more expensive
for other currency holders.
Among other metals, spot silver fell 2.2% to $74.23
per ounce, platinum lost 0.5% to $2,034.95, while
palladium gained 1% to $1,535.77.
Published on April 13, 2026
