WASHINGTON (dpa-AFX) - Prices of the yellow metal decreased on Friday as markets digested the likelihood of interest rates remaining high for longer than expected, owing to the unresolved geopolitical situation in the Middle East.
Gold has been pressured by the energy price shock triggered by the Middle East war as both the crude oil price benchmarks have jumped more than 80 percent on a year-to-date basis. Fears of a fuel-led inflationary spiral have ignited hawkish hints from major central banks and worries about an increase in the general interest rates.
A resultant spike in the opportunity cost of holding non-interest-bearing gold has dimmed the appeal of the precious metal. A softer dollar has also not boosted gold prices in Friday's trade. The Dollar Index which measures the strength of the dollar against a basket of six currencies is almost 0.20 percent lower in the day's trading. It is currently trading at 97.89 after ranging between 97.82 and 98.24.
Gold Futures for June settlement is currently trading at $4,603.21, losing 0.57 percent from the previous close of $4,629.60. While the day's trading ranged between $4,571.24 and $4,647.71, the 52-week trading ranged between $3,123.30 and $5,626.80. Gold Futures had touched an all-time high of $5,626.80 on January 29.
The day's price movements have resulted in a weekly loss of 2.9 percent. Despite monthly losses of 1.6 percent, year-to-date gains are close to 5 percent. The yellow metal's price gain over the 3-year horizon now stands at close to 128 percent.
Spot Gold is currently trading 0.65 percent lower on an overnight basis at $4,591.56 per troy ounce. While the day's trading ranged between $4,560.39 and $4,636, the 52-week trading ranged between $3,120.52 and $5,595.46. Spot Gold had touched an all-time high of $5,595.46 on January 29.
At current prices, Gold Futures and Spot Gold have both gained more than 40 percent over the past year.
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