Gold Prices Drop to $4,173.55 as Stronger Dollar Offsets U.S.-Iran Tensions

LONDON — Gold prices slid to their lowest level in 11 weeks on Wednesday, falling 2.08 percent to $4,173.55 per ounce as a stronger dollar and rising oil prices driven by renewed US‑Iran hostilities fueled inflation concerns and expectations of interest rate hikes.

The US dollar strengthened, making dollar‑denominated gold more expensive for buyers using other currencies. Meanwhile, oil climbed back above $92 a barrel after the United States launched strikes on Iran on Tuesday, following President Donald Trump’s claim that Tehran downed a US Apache helicopter in the Strait of Hormuz. Iran’s Revolutionary Guards retaliated with attacks on a US base in Jordan and 21 other targets across the Gulf.

“Gold’s correction deepened after stronger‑than‑expected US jobs data and renewed inflation concerns pushed bullion below its 200‑day moving average for the first time since October 2023,” said Ole Hansen, head of commodity strategy at Saxo Bank.

Traders now see more than a 70 percent probability of a US rate hike by December, according to the CME FedWatch Tool. Higher rates reduce the appeal of non‑yielding gold.

In the UAE, 24‑carat gold dropped AED10.75 to AED503.5, while 22‑carat fell AED10 to AED466.25. Spot silver fell 2.1 percent to $64.01 per ounce, platinum dropped 3.4 percent, and palladium declined 1.5 percent. Investors are awaiting US inflation data due later Wednesday and Thursday for further clues on Federal Reserve policy.

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