Gold slides nearly 2% amid Middle East tensions and rising inflation worries
Gold prices slipped close to 2 percent on Monday following a flare‑up in U.S.‑Iran confrontations that bolstered the dollar and revived inflation anxieties, keeping the prospect of higher interest rates on the table. Spot gold was down 1.9 percent at $4,526.88 per ounce by 11:26 a.m. ET, while U.S. gold futures fell 2.3 percent to $4,537.90.
A fire broke out in the Fujairah Oil Industry Zone after authorities said a drone attack traced to Iran, and the U.S. Navy deployed two guided‑missile destroyers into the Gulf to challenge an Iranian blockade. The stronger dollar made dollar‑denominated metals more costly for holders of other currencies, and Brent crude surged more than 5 percent.
Barclays joined other brokers in betting that the Federal Reserve will not ease policy this year, a view reinforced by the Fed’s recent decision to hold rates steady amid deepening concerns over soaring energy prices. Upcoming U.S. data releases, including job openings, the ADP employment report and the April payrolls, will be closely watched. Analyst Bart Melek of TD Securities noted strong support around $4,200 for gold, but warned that lingering uncertainty and possible rate hikes could prompt short‑term exits.
Precious metals other than gold also fell sharply: spot silver dropped 2.9 percent to $73.12, platinum slipped 2.1 percent to $1,947.05, and palladium decreased 3.5 percent to $1,471.50.
