Gold Slides Over 10% to $4,751 After US Blockade Spurs 8% Oil Rally
Spot gold price has declined to $4,751 per ounce, down over 10% since Feb. 28 and off the January peak near $5,500. A US blockade of Iranian ports has driven crude oil up 8% past $100, stoking inflation fears and cutting Fed rate-cut odds to 16%.
1. Gold Price Decline
Spot gold has fallen to $4,751 per ounce after peaking near $5,500 in January, representing a drop of more than 10% since the Iran war began on Feb. 28. This marks the steepest decline for non-yielding gold assets in months.
2. US Blockade and Oil Surge
The US military’s blockade of maritime traffic to and from Iranian ports has lifted crude oil prices by 8%, pushing them back above $100 a barrel. Higher oil costs raise inflation expectations, undercutting demand for interest-rate sensitive assets like gold.
3. Fed Rate-Cut Odds and Dollar Rally
Futures markets now assign only a 16% probability to a Fed rate cut this year, down from expectations of two quarter-point cuts in June and September. Meanwhile, the US dollar has climbed to a one-week high, making gold more expensive for foreign buyers.