TLDR
- Spot gold maintained position around $5,183 per ounce Thursday, trading within a tight range
- Dollar strength and reduced expectations for rate cuts created headwinds for precious metal prices
- Regional conflict in Middle East drove Brent crude temporarily above $100 per barrel, climbing nearly 60% year-to-date
- Gold ETF holdings experienced largest weekly decline in over two years as market participants liquidated positions
- Silver advanced more than 1.6% reaching $87.19; BMI analysts project silver to average $93 per ounce in 2026
Gold continues trading near record territory while experiencing reduced upward momentum following the commencement of US-Israeli military operations against Iran on February 28. Market participants currently weigh safe-haven appeal against dollar appreciation and diminishing Federal Reserve rate-cut prospects.
Spot gold showed minimal movement at $5,183.39 per ounce Thursday morning during New York trading hours. US gold futures for April delivery advanced 0.2% to $5,190.50. The precious metal has accumulated nearly 20% gains year-to-date.
The regional conflict in the Middle East serves as the primary catalyst for current market volatility. Thursday brought reports of two tankers burning in Iraqi waters, appearing to represent an intensification of Iranian strikes targeting regional energy facilities.
Brent crude temporarily surged above $100 per barrel during Asian market hours. Oil valuations have climbed nearly 60% throughout the current year. Elevated oil prices increase transportation expenses and manufacturing costs, contributing to wider inflationary pressures.
Gold functions as a recognized hedge against inflation. However, these same inflationary concerns simultaneously diminish expectations for near-term Federal Reserve interest rate reductions. Elevated rates enhance the appeal of yield-generating assets compared to gold.
The US dollar strengthened for a third consecutive session Thursday. Dollar appreciation increases gold costs for international buyers utilizing alternative currencies, potentially dampening demand.
“Gold has been range bound recently. The higher dollar index, rising treasury yields and lack of interest rate cuts are the negative factors, but the conflict in the Middle East has been generating some safe-haven flows,” said Phillip Streible, chief market strategist at Blue Line Futures.
Gold ETF Holdings Drop
While prices remain steady, gold exchange-traded fund holdings recorded their largest weekly decline in more than two years. Market participants have been liquidating gold positions to generate cash for covering portfolio losses in other sectors.
Jeff Currie of Carlyle Group shared with Bloomberg Television his expectation for gold demand to strengthen following this conflict. He noted emerging market purchasers are favoring gold over US assets to mitigate risks of foreign reserve freezes, similar to actions taken against Russia in 2022.
Silver and Platinum Also Move Higher
Silver demonstrated stronger performance than gold Thursday, advancing 1.6% to $87.19 per ounce. Silver has accumulated gains exceeding 146% throughout 2025.
BMI analysts project silver will average $93 per ounce during 2026. Their forecast indicates robust investment demand will counterbalance softer demand from solar panel manufacturers and jewellery producers at elevated price points.
Spot platinum increased 0.7% to $2,184.00. Palladium climbed 1.6% to $1,666.70.
Core US inflation data released Thursday showed moderate readings at the year’s beginning. However, forward-looking inflation concerns connected to Middle East hostilities prompted traders to scale back expectations for Fed rate reductions in 2025.
Blue Line Futures’ Streible noted that oil price stabilization or declines could relieve pressure on treasury yields and the dollar, potentially enabling gold futures to advance higher.
