Gold prices tumbled to near one-week lows as a stronger dollar and fading Federal Reserve rate-cut expectations weighed on the precious metal. Spot gold fell 0.6% to $4,718.98 per ounce, marking its lowest level since April 7. The decline accelerated after failed U.S.-Iran peace talks triggered a surge in oil prices above $100 a barrel, intensifying inflation concerns and prompting traders to abandon hopes for interest rate cuts this year. The dollar strengthened 0.4%, making gold more expensive for international buyers. Market analysts note that elevated energy prices now fuel expectations for potential central bank rate hikes rather than cuts, creating a challenging environment for non-yielding assets like gold. Since the Middle East conflict began on February 28, gold has fallen more than 11% from its peak levels.
