SPDR Gold Shares Slides Over 7% to $4,660, Biggest Weekly Loss in Six Years
Gold ETF GLD is set for its largest weekly drop in six years, sliding over 7% to about $4,660 an ounce as surging energy costs fuel inflation concerns and push Treasury yields higher. Sustained outflows from gold-backed ETFs and a Fed hold on interest rates are weighing on bullion sentiment.
1. Weekly Performance and Price Drop
Gold ETF GLD fell more than 7% this week, trading around $4,660 per ounce by March 20, marking its largest weekly decline since 2020. This slump erased gains from earlier in the year and represents the steepest drop in six years.
2. Drivers Behind the Decline
A surge in crude, natural gas, and fuel costs has rekindled inflation concerns, pushing Treasury yields and the US dollar higher. Higher real yields have reduced demand for non-yielding assets like gold, undermining its appeal as a hedge.
3. ETF Outflows and Market Sentiment
Investors have withdrawn significant funds from gold-backed ETFs, with outflows wiping out all inflows recorded at the start of the year. Selling to cover losses in other asset classes has compounded pressure on GLD’s holdings.
4. Longer-Term Outlook
Despite the recent downturn, gold remains about 8% higher year-to-date after touching near-record highs just below $5,600 an ounce in January. Strategists caution that a prolonged geopolitical conflict could shift focus toward recession risks, potentially restoring gold’s safe-haven appeal.