Gold Has Stayed Flat Amid Iran Conflict — Here’s Why and Where It Could Head Next Despite ongoing tensions in the Middle East, gold prices have remained largely unchanged since the recent escalation of hostilities with Iran. This contrasts with the sharp rally the metal experienced during the 12-day war last year, which saw its price surge from $5,296 to $5,423 per troy ounce after U.S. and Israeli strikes on Iran. However, the recent conflict has not triggered a similar upward move, with gold trading between $5,050 and $5,200 as of late. Spot gold was last reported at $5,175 per ounce. Analysts suggest several factors are dampening gold’s usual safe-haven appeal. A stronger U.S. dollar and higher Treasury yields have made the metal less attractive compared to interest-bearing assets like government bonds. Ross Norman, CEO of Metals Daily, noted that rising oil prices could prolong inflationary pressures, potentially leading to higher interest rates. Central banks struggling to manage the economic fallout from a possible closure of the Strait of Hormuz, a critical oil route, might raise rates further, which could reduce demand for non-yielding assets like gold. Geopolitical tensions typically drive investors toward gold, but recent volatility has disrupted this pattern. Norman observed that gold’s price movements have been lackluster, possibly due to its recent extreme swings. Some institutional investors have grown wary of holding bullion amid its unusual volatility. Amer Halawi, head of research at Al Ramz, explained that conflicts often trigger panic selling, creating a “flush” where traders are forced to liquidate positions as prices drop. He added that while gold may initially sell off during shocks, it often rebounds later as markets stabilize.#iran #deutsche_bank #jp_morgan #ross_norman #amer_halawi
