Spot gold drops to a six-month low near $4,000 as U.S. rate expectations and a stronger dollar curb its safe-haven appeal.
Gold prices fell to $4,188 per ounce on Friday, down from January’s record $5,595, as expectations of U.S. monetary tightening and a resilient dollar eroded bullion’s momentum. The metal touched a six-month low of $4,022 on Thursday, breaking below its 200-day moving average for the first time in over two years.
The reversal follows strong U.S. jobs data that bolstered bets on Federal Reserve rate hikes, while geopolitical tensions, including the Iran conflict, drove oil prices higher. Analysts note that gold’s safe-haven demand typically wanes during extreme shocks, though long-term support remains from fiscal deficits and central bank purchases.
A potential easing of Middle East tensions and a drop in oil to $80 could spark a rebound, but near-term pressure persists as traders assess the Fed’s policy path.