Gold extended a decline as the escalating war in the Middle East heightened energy-supply and inflation risks, while a surprise drop in US jobless claims also reduced prospects for an interest-rate cut.
Bullion fell as much as 1.6% to near $4,600 an ounce, having lost 1.7% in the session that preceded the long weekend. In a social-media post, Trump said he would bring “Hell” to Iran if it didn’t open the Strait of Hormuz. Tehran rejected the ultimatum and kept up strikes on energy infrastructure in the region, including a barrage of attacks on Kuwait’s oil-refining and petrochemical facilities.
Meanwhile, nonfarm payrolls in March rose the most since the end of 2024, according to Bureau of Labor Statistics released Friday. The increase will likely reinforce the Federal Reserve’s focus on inflation risks that are compounded by higher oil prices, reducing the likelihood of a reduction in borrowing costs. Non-yielding gold typically benefits from a low-rate environment.
Adding to these concerns, the spike in US gasoline prices felt by American consumers will be on full display when key US inflation data is released this week. Economists are forecasting a 1% increase in the consumer price index for March, which would be the sharpest one-month advance since 2022. The war has added more than $1 per gallon to prices at the pump, and crude oil climbed again on Monday.
Gold has fallen more than 12% since the conflict began in late February, as spiking energy prices have stoked fears of inflation and the prospects for rate cuts have receded. Bullion’s haven appeal has also been dimmed by the need for investors to liquidate their positions and cover losses elsewhere.
“People are taking chips off the table to protect their assets,” said Robert Gottlieb, a market commentator and former precious metals trader at JPMorgan Chase & Co.
Gold has also been rattled by Trump’s frequently contradictory messaging on the conflict, which has oscillated between threats to step up attacks and signals that the war is nearing an end. Bullion gained more than 4% last week, with Thursday’s decline breaking a four-day winning streak.
“As long as we have those conflicting messages, gold is very much traded on headlines,” Gottlieb said.
Trump said he plans to hold a news conference at 1 p.m. on Monday and also posted about a Tuesday 8 p.m. Eastern Time deadline, without offering any details. On March 26, the US president gave Iran a 10-day deadline to reopen Hormuz, which would expire Monday evening.
Spot gold fell 1.1% to $4,623.32 an ounce at 9:56 a.m. Singapore time. Silver dropped 1.6% to $71.88. Platinum declined, while palladium was little changed. The Bloomberg Dollar Spot Index, a gauge of the US currency, rose 0.1% after ending the previous session up 0.3%.
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