Gold Prices Drop 1.8% on Reports of Escalating US Military Presence in the Middle East

US Gold Prices Fall 1.8% Amid Strengthening Dollar and Treasury Yields

March 20: The US dollar and U.S. Treasury yields continued their upward trend on Friday, leading to a 1.8% decline in gold prices. Spot gold fell to $4,563.64 per ounce as of 2:14 p.m. ET, after earlier rising 1%. U.S. gold futures for April delivery were 0.7% lower at $4,574.90.

The strengthening dollar makes dollar-priced bullion less attractive to holders of other currencies. The U.S.-Israeli war on Iran has had a significant impact on the global economy since its launch on February 28. Iran's prolonged blockade of the Strait of Hormuz could keep energy prices elevated and fuel inflation.

Key Figures

Read also: Gold and Silver Prices Decline Amid Strengthening Dollar and Inflation Concerns

• Spot gold: $4,563.64 per ounce (down 1.8% from previous day)
• U.S. gold futures for April delivery: $4,574.90 (down 0.7% from previous day)
• Spot silver: $69.39 (down 4.8% from previous day)
• Platinum: $1,953.18 (down 0.9% from previous day)
• Palladium: $1,423.59 (down 1.6% from previous day)

Market Outlook

Major global brokerages see a higher likelihood of the European Central Bank and Bank of England raising interest rates, potentially as early as April. The Federal Reserve held interest rates steady on Wednesday and projected higher inflation, while Chair Jerome Powell said its future policy path was subject to unusually high uncertainty due to the war.