Gold prices declined in Asian trading on Thursday, extending recent losses and briefly falling below a key trading band, as ongoing uncertainty around the Iran conflict and U.S. interest rate expectations boosted the dollar and weighed on demand for safe-haven assets.
Spot gold dropped 0.6% to $4,712.50 per ounce, while gold futures slipped 0.5% to $4,728.69/oz by 02:30 ET (06:30 GMT). Spot prices briefly touched $4,694.23/oz, dipping below the $4,700–$4,900 range that had held over the past two weeks.
Dollar favored over gold amid haven demand
The precious metal struggled to gain traction as markets remained uncertain over the prospects for renewed U.S.-Iran negotiations, despite President Donald Trump’s decision to extend the ceasefire indefinitely.
Both Tehran and Washington showed limited willingness to resume talks after planned negotiations collapsed earlier in the week. Iran maintained that the U.S. must lift its blockade before discussions can proceed, while Washington insisted on a full reopening of the Strait of Hormuz.
With Iran continuing to restrict access through Hormuz and the U.S. sustaining its naval presence and monitoring Iranian shipping across the region, the standoff remains unresolved.
Oil prices surged back above $100 per barrel this week, reflecting ongoing supply constraints through the strait.
Rate outlook pressures precious metals
Wider metals markets also faced pressure from a stronger U.S. dollar, which hovered near a one-and-a-half-week high on Thursday.
Spot silver declined 2% to $76.1295 per ounce, while platinum fell 1.4% to $2,050.65 per ounce.
The dollar found support after Trump’s nominee for Federal Reserve Chair, Kevin Warsh, indicated he had not committed to lowering interest rates, despite pressure from the president. Warsh is widely seen as less dovish, with his nomination in late January previously triggering sharp declines in gold and other precious metals.
Separately, a Reuters survey showed that investors do not expect the Federal Reserve to cut rates for at least six months, amid continued uncertainty tied to the Iran conflict.
The inflationary impact of the conflict—driven by elevated oil prices—has also weighed on metals. Traders remain concerned that energy-related inflation could prompt a more hawkish stance from major central banks, with both the European Central Bank and the Bank of England already flagging such risks.