Gold Struggles to Recover as Market Fears Turn into Inflation Concerns
Gold prices are again under pressure as global markets grow increasingly anxious about the US-Israel war against Iran, which has yet to show a clear resolution. The problem is, this tension does not automatically benefit gold as a safe haven asset. In the current phase, the market is more concerned about the continued impact of the war on energy prices, inflation, and interest rates. Reuters noted that on April 1, 2026, gold rose to US$4,784.22 per ounce, but earlier on March 26, 2026, it fell sharply to US$4,384.38 when the dollar strengthened and oil prices rose. This indicates that gold is now highly sensitive to inflation expectations and monetary policy direction, not just the conflict itself.
The latest pressure comes from surging energy prices. On April 6, 2026, Reuters reported that Brent rose to around US$111.43 per barrel and WTI to US$114.57 after Donald Trump renewed threats against Iran if the Strait of Hormuz was not opened. When oil prices rise this sharply, markets begin to consider the risk of renewed inflation that could spread to gasoline, logistics, and the cost of living. Under such conditions, gold could actually lose its short-term appeal as investors see the likelihood that central banks will hold interest rates high for longer.
From the United States, pressure on gold is also reinforced by still-strong economic data. Reuters reported that US payrolls increased by 178,000 in March, far above the 60,000 forecast, while the unemployment rate fell to 4.3%. Data like this reduces the urgency for the Fed to cut interest rates immediately. The lower the chance of a rate cut, the more difficult gold's position becomes, as the precious metal offers no yield and is typically less attractive when yields and the dollar remain high.
The Fed's cautious tone also emphasizes this pressure. Fed Chairman Jerome Powell said the central bank could "wait and see" to assess the impact of the war on inflation, while global bond markets have already responded to the energy surge with rising yields and reduced expectations of interest rate cuts. Reuters also reported that Trump has not provided a clear timeline for ending the war, something that maintains uncertainty but also prolongs concerns that this energy shock will not dissipate quickly. This combination is what is putting gold under pressure: the conflict does increase fear, but that fear is now being interpreted by the market more as an inflationary threat than a genuine push for safe havens.
It's worth noting that Reuters did not publish a precious metals report on April 3, 2026, because many markets were closed for Good Friday. Therefore, the most reasonable reading for the start of this week is that the pressure on gold is a continuation of the pattern seen in the previous few days: high oil prices, the dollar and yields remain sensitive, and the market is increasingly doubtful that the Fed will ease soon.(Zaf)
Source: Newsmaker.id
