Gold price continues to slide as US-Iran deal stalls

Gold dipped on Monday after two straight weekly declines, as a stalled United States-Iran deal continued to reinforce investor concerns over inflation.

Spot gold fell as much as 1.8% to just above $4,500 per oz. during early hours of trading, before paring half of the losses. U.S. gold futures also fell but were trading slightly higher at nearly $4,600.

The yellow metal about has lost 13% since the start of the Middle East war, which has kept energy prices elevated and made central banks less inclined to cut interest rates — a scenario that would have boosted the non-yielding gold. While bullion has stabilized over the past month, it remains pressured by ongoing uncertainty surrounding a potential resolution to the conflict.

Driving the decline in recent weeks was the lack of progress in peace talks, with U.S. President Donald Trump judging the latest proposal by Iran to be less than satisfactory.

Meanwhile, issues surrounding the Strait of Hormuz, which accounts for a fifth of the world’s oil transports, remain. Earlier, Iran said it had forced a U.S. warship to turn back from entering the Strait, but a U.S. official denied a report that it had been struck by Iranian missiles, according to Axios.

“The latest news clearly didn’t give the market confidence that everything is going to be okay and again raised the specter of inflation issues, along with fairly hawkish signals to the market on interest rates,” Bart Melek, global head of commodity strategy at TD Securities, said in a note.

This week

In the near term, investors will focus on this week’s announcement of the U.S. Treasury Department’s borrowing plans, an array of Federal Reserve speakers and a loaded calendar of economic data releases which may offer clues on the trajectory of US rate cuts.

Longer term, market participants are largely optimistic that gold could bounce back amid strong buying by global central banks. According to the World Gold Council, central banks added to their gold holdings at the fastest pace in more than a year in the first quarter.

Recently, Deutsche Bank said that the aggressive pivot towards bullion, especially in emerging markets, could propel bullion to as high as $8,000 an oz. within five years. For 2026, banks including Goldman Sachs and JPMorgan have set price targets of $5,400 and $6,300 respectively.

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