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Gold has faced short-term headwinds from high yields, a strong dollar, and profit-taking, causing its price to fall by around 16% since the outbreak of the Iran conflict, despite inflation and geopolitical tensions that would normally boost demand. Emily Avioli of Merrill explains that this pullback is largely due to market positioning, interest rate expectations, and dollar strength rather than a change in gold’s fundamentals. The metal had seen an extraordinary rally since 2022, surpassing $5,400 per ounce in January, prompting profit-taking and a natural consolidation following such sharp gains. Rising real yields and a stronger dollar have increased the opportunity cost of holding non-yielding assets like gold, reducing its appeal compared to income-generating alternatives.
Despite these short-term pressures, structural factors supporting gold remain intact. Persistent fiscal deficits, ongoing central bank diversification of reserves, and the likely moderation of the dollar point to continued long-term demand. Avioli suggests that once uncertainty around the Middle East conflict diminishes, these underlying drivers will reassert themselves, keeping gold relevant as a strategic diversifier in balanced investment portfolios. Source
Image Source: Kitco News
Gold prices edged higher while silver dipped slightly in midday U.S. trading, supported by mild safe-haven demand and some speculator buying, though gains were restrained by a rise in U.S. stock indices. June gold was trading at $4,688.20, up $9.50, while May silver fell $0.264 to $72.65. A strong U.S. employment report added pressure to the metals, reinforcing expectations for higher interest rates for longer and weighing on bullion sentiment. Crude oil remained near $111.50 a barrel, the U.S. dollar index slipped slightly, and the 10-year Treasury yield stood at 4.327 percent.
Technically, gold bulls aim to break resistance at $5,000, with support around $4,300, while silver bulls target $80 with downside support at $61.21. Current trading shows gold near $4,688 and silver near $72.65, reflecting a balance of conflicting fundamentals and market positioning. Source
The Bank of France executed a profitable manoeuvre by selling 129 tonnes of its gold held in the U.S. and repurchasing it in Europe, generating a net gain of around EUR 11 billion. This “exceptional item” transformed a previous EUR 2.9 billion loss into an EUR 8.1 billion profit for the 2025 fiscal year, boosting the central bank’s net equity to EUR 283.4 billion. The strategy involved selling older, less pure gold bars in New York at peak U.S. dollar prices and acquiring new bars in Europe that met updated weight and purity standards, avoiding diplomatic or logistical complications.
Despite the transactions, France’s total bullion holdings remained unchanged at roughly 2,437 tonnes, now stored entirely in the Bank of France’s underground vault in La Souterraine. Governor Francois Villeroy de Galhau emphasised that the decision to retain the gold in Paris was not politically motivated. The operation strengthened the bank’s financial position without altering its overall reserve volume, illustrating a clever and highly profitable management of national gold assets. Source
Gold hovered near $4,667 per ounce following the release of the ISM Services PMI, which fell to 54 in March, down from February’s 56.1 and below economists’ expectations of 55. The decline reflects slower growth in the U.S. service sector, driven by higher energy prices and supply chain disruptions linked to the Iran conflict, winter weather, and shipping delays. While overall business activity, new orders, and backlogs remain strong, the Employment Index dropped to its lowest level since December 2023, signalling uneven momentum across the sector. Rising costs for oil, fuel, lumber, copper, and steel contributed to a spike in the Prices Index, heightening concerns over inflationary pressures.
Economists note that the mixed signals indicate uncertainty for businesses, with higher oil prices from the Middle East conflict dominating concerns and impacting inventories and costs across industries. While capex spending continues, prolonged tensions over the Strait of Hormuz could further darken the U.S. and global economic outlook. In the short term, gold remains influenced by these geopolitical and inflation risks, with investors closely monitoring the flow-through effects of energy price shocks. Source
The U.S. economy added 178,000 jobs in March, far exceeding forecasts of 65,000, with gains concentrated in health care, construction, and transportation, while federal government employment continued to decline. The unemployment rate fell to 4.3% from 4.4%, signalling continued strength in the labour market. Wage growth was modest, with average hourly earnings rising 0.2% to $37.38, below expectations, suggesting inflation pressures from wages remain contained. Revisions to earlier months showed mixed results, with January’s jobs figure revised up and February’s revised down.
Analysts expect the strong employment data to weigh on gold prices, as robust job growth reduces the likelihood of near-term interest rate cuts by the Federal Reserve. Despite geopolitical tensions and rising energy prices linked to the Iran conflict, gold’s safe-haven appeal may be limited unless weaker economic data raises stagflation concerns. The report highlights the resilience of the U.S. labour market, supporting consumer spending and reinforcing the Fed’s cautious approach to monetary policy. Source
Gold showed strong weekly gains despite volatile trading influenced by mixed signals from the U.S. administration regarding the Iran conflict. Spot gold began the week around $4,400 per ounce, climbing above $4,700 midweek as optimism for a diplomatic breakthrough emerged, but tumbled over $100 following President Trump’s threats against Iran’s civilian and oil infrastructure. By the end of the shortened trading week, gold settled just below $4,700, marking its second consecutive positive weekly performance. Analysts noted that retail investor sentiment grew moderately bullish, while institutional participants on Wall Street largely stayed on the sidelines amid uncertainty and thin trading volumes during the holiday period.
Market observers highlighted that gold’s short-term movements were dominated by geopolitical developments, with physical demand in Asia supporting the market until the U.S. presidential address caused abrupt reversals. Analysts expect continued volatility over the coming week, with attention shifting to U.S. economic releases including employment, inflation, and Federal Reserve minutes. Technical indicators suggest resistance near $5,000 and support around $4,300, while the broader outlook for gold remains fundamentally bullish once clarity emerges on the Iran situation and market liquidity normalises. Source
Gold is poised to end the week with a 3% gain above $4,600 per ounce, but prices have struggled to break the $4,800 resistance level amid heightened volatility from the U.S. and Israel’s conflict with Iran. While the market showed bullish momentum earlier in the week on hopes for a swift resolution, President Trump’s national address and rising oil prices above $100 a barrel have increased expectations of a prolonged conflict. Analysts note that persistent uncertainty and potential supply-chain disruptions are keeping the U.S. dollar strong and creating headwinds for gold, even as the metal retains its recovery from last month’s selloff.
Medium-term prospects for gold remain cautiously positive, with analysts identifying key support around $4,600 and psychological resistance near $5,000. The precious metal’s safe-haven appeal may become more prominent if the conflict escalates and threatens global growth, despite short-term pressures from higher interest rates and inflation concerns. Investors will be watching upcoming U.S. economic releases, including the nonfarm payrolls, ISM Services PMI, durable goods orders, Federal Reserve minutes, and inflation data, as these will heavily influence gold’s near-term trajectory. Source
Central banks continued to buy gold in February despite rising geopolitical tensions and inflation pressures stemming from the Iran conflict. Total purchases reached 19 tonnes, led by the National Bank of Poland, which increased its reserves by 20 tonnes, bringing its total to 570 tonnes and moving closer to its target of 700 tonnes. Other buyers included the central banks of Uzbekistan, Malaysia, China, and the Czech Republic, while Russia and Turkey were the main sellers, with Turkey reducing its holdings by eight tonnes and further declines reported in March. Analysts expect central bank demand to moderate as nations focus on protecting their economies from supply-chain disruptions and rising energy prices, but emerging market entrants like Uganda and Kenya are supporting continued gold accumulation.
The report highlights a cautious but sustained commitment to gold as a reserve asset, with new domestic purchasing programmes in Africa and Southeast Asia reinforcing the broader trend. Despite uncertainty and geopolitical risks, central banks appear to value gold’s role in safeguarding reserves, although price sensitivity is increasingly shaping their buying strategies. Source
Gold remains an important portfolio diversifier despite recent underperformance, with HSBC strategists Willem Sels and Lucia Ku maintaining a bullish medium to long-term outlook. The rise in cross-asset correlations has increased gold’s appeal as a safe-haven and alternative asset, and the bank continues to hold an Overweight position. While short-term headwinds, including a stronger US dollar and hawkish interest rate expectations, have weighed on prices, underlying fundamentals such as central bank buying, geopolitical uncertainty, and global de-dollarisation continue to support gold. Analysts emphasise that recent volatility reflects shifts in market ownership and retail participation, rather than a weakening of gold’s long-term case.
HSBC notes that gold is behaving more like a risk asset in 2026, influenced by leveraged retail buyers and rapid market shifts. Traditional relationships, such as the inverse correlation between real US 10-year yields and gold, have weakened, yet long-term investment potential remains strong. Analysts stress that portfolio diversification should be broad-based to manage volatility, which is expected to define the precious metals market this year. Source
Gold has rebounded above $4,700 an ounce following its largest monthly loss since the early 1980s, but technical analyst Avi Gilburt warns that the correction may not be over, with potential to fall toward $3,800. He identifies two scenarios: one where prices meet resistance near current levels and decline, and a more deceptive path where a rise to $5,200 could precede a sharper downtrend. Silver faces a similar risk, with downside toward $53.50 if prices stay below recent highs, though long-term value remains strong for investors under $60.
Gilburt also highlights opportunities in mining equities, suggesting some stocks could outperform gold and silver during a rally, while others remain in corrective patterns. He sees broader commodity markets, including oil, subject to near-term gains but potential declines later in the year. His outlook is primarily guided by technical market structures, with key inflection points in precious metals, equities, and commodities expected in the coming months. Source
Silver’s recent correction is seen as a natural clearing of overleveraged positions rather than a threat to its long-term upside, with structural factors supporting a potential rally to triple-digit levels. The Middle East conflict has temporarily dampened investment demand, but high oil prices and China’s focus on advanced manufacturing, renewable energy, and semiconductor self-sufficiency continue to drive silver consumption. Once geopolitical tensions ease, silver could see significant gains, and disciplined trading strategies that avoid chasing volatility are recommended to capitalise on the next leg higher.
Traders are encouraged to consider approaches such as Bull Call spreads on futures or systematically purchasing smaller 100-ounce contracts to build positions gradually. These methods aim to balance risk and reward while preparing for potential rallies. Hypothetical performance results are used to illustrate strategies but may differ from actual trading outcomes due to market and implementation factors, emphasising the importance of careful planning and risk management. Source
Silver prices have rebounded to around $75 an ounce, but analysts are cautioning investors against exaggerated expectations driven by social media hype, particularly around extreme out-of-the-money $1,000 silver call options. While these options exist on paper, they have no open interest and are mostly a tool for retail investors to participate without committing large sums, given the high cost of holding at-the-money options or futures. Analysts warn that these trades are largely speculative and disconnected from fundamentals, with little realistic expectation of silver reaching such levels by year-end.
Some commentators also highlight a risk of market manipulation, where mass purchases of out-of-the-money calls could force dealers to hedge by buying futures, creating a short-term artificial price spike similar to previous events in other markets. Overall, this type of options activity is seen as potentially bearish, as elevated implied volatility from these trades often precedes trend reversals rather than sustained gains. Source
In this week’s Live from the Vault, Andrew Maguire welcomes Andy Schectman of Miles Franklin to examine the widening gap between COMEX and physical metal flows, highlighting record deliveries and unprecedented sovereign accumulation.
The two friends examine the erosion of trust in Western systems and the influence of key players, including China and central banks, quietly absorbing substantial quantities of gold and silver and altering the dynamics of the metals market.
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
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