Gold prices fell during Asian trading on Monday. An exchange of strikes between the US and Iran over the weekend threatened a fragile truce and revived market fears of a fresh inflationary wave and further interest rate increases.
Quotes continued to decline even after urgent reports that Washington and Tehran had agreed to cease fire and return to talks this week. By Monday morning, the spot price of gold had slipped 0.8% to $4,055.50 an ounce, while futures lost 0.7%, reaching $4,069.25.
Last week, the metal already touched an eight‑month low amid expectations that the Federal Reserve has not finished its tightening cycle. A recent pause in the Middle East conflict briefly calmed markets — oil retreated toward prewar levels, easing inflation concerns. However, fundamental pressure on gold persists because of a strong dollar and high Treasury yields.
The market increasingly expects a hawkish outcome. According to the CME FedWatch tool, the probability of a Fed rate hike by the end of 2026 is now assessed at more than 30%. Persistent US inflation and hawkish signals following the Fed’s June meeting are forcing investors to favor debt instruments, since high rates raise the carry cost of holding non‑yielding assets.
The downtrend spilled over to other precious metals. At the start of trading on Monday, the spot price of silver fell 1.3% to $58.44 an ounce, and platinum declined 1.1% to $1,622.34.