The non-yielding asset fell on Monday, with spot gold dropping 1.3% to $4,036.19 per ounce, putting it on track for its fourth consecutive monthly loss. The decline comes amid geopolitical friction in the Gulf, which has heightened inflation anxieties and backed the case for a more hawkish U.S. Federal Reserve.
Though the U.S. and Iran have agreed to resume negotiations over the Strait of Hormuz, the market remains volatile after a weekend of military strikes and heavy rhetoric. Analysts note that while geopolitical friction usually lifts gold, the threat of rising energy prices reinforcing high interest rates is currently dragging the metal down. Investors are now closely watching upcoming U.S. employment reports to gauge the Fed’s next moves, as strong data could push gold below $4,000. Other precious metals mirrored the downturn, with silver and platinum posting losses, though palladium bucked the trend to rise slightly.
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