Gold prices plunged 3% on Thursday, extending losses for a third session to a more than one-year low as rising oil costs on dwindling hopes for peace in the Middle East fuelled fears of greater inflation and elevated interest rates.
Spot gold dropped 3.0% to $3,867.96 per ounce by 10:01 a.m. ET (1501 GMT), after hitting its lowest level since October 2025 earlier in the morning. US gold futures for December delivery lost 3.2% to $3,872.00 an ounce.
US President Donald Trump said on social media Thursday that the United States did not need an agreement with Iran. Those days were far gone," he added, dashing expectations of a settlement to stop a crisis that began in late February with US-Israeli strikes on Iran and has extended across the Middle East.
Crude oil prices could spike higher on this news, which is negative for gold from an inflation perspective," said Jim Wyckoff, a market analyst with American Gold Exchange. Oil futures surged more than 1%, stoking fears of inflation and wagers that the Federal Reserve may keep rates higher for longer.
A strong U.S. consumer price data Tuesday, hawkish comments from Fed members this week and a surge in the U.S. dollar index to a near 19-month high “are working to press the gold market lower,” said Wyckoff. Markets estimate a 91% chance of a 25-basis-point rate hike in December, while the odds of a bigger 50-basis-point move also rose.
