Renewed geopolitical risks boost crude oil and the dollar, pressuring gold despite long-term bullish forecasts from analysts.
Gold futures retreated Monday, snapping a two-day rally, as escalating U.S.-Iran tensions drove crude oil higher and stoked inflation concerns. The stronger U.S. dollar made gold more expensive for foreign buyers, adding to the downward pressure on prices.
Prior to the decline, gold had posted consecutive gains amid safe-haven demand. Analysts noted that while short-term volatility persists, central bank diversification—particularly after Russia’s reserves were frozen—continues to underpin long-term bullish outlooks for gold.
The market reaction reflected a shift in focus toward rising oil prices and potential interest rate hikes, overshadowing geopolitical risks that typically support gold.