Key Takeaways
- Gold reached $4,475 per ounce during Friday trading before retreating to the $4,408–$4,417 range
- President Trump moved his Iran energy strike deadline to April 6, claiming negotiations are progressing positively
- Iranian officials publicly rejected claims that diplomatic discussions with Washington are underway
- The precious metal has dropped over 15% since hostilities between Iran and Israel escalated roughly one month ago
- Turkey’s central bank offloaded and exchanged approximately 60 tons of gold valued at more than $8 billion within a two-week period
The yellow metal experienced a significant surge during Asian market hours on Friday, advancing approximately 2% before retracing a portion of those advances as the session progressed. Spot gold was trading higher by roughly 0.9% at $4,417 per ounce by mid-morning in London. Gold futures contracts similarly advanced, climbing about 0.8% to reach $4,442.
Notwithstanding Friday’s intraday advance, the precious metal remained positioned for a weekly decline of approximately 1.7%.
The price action followed President Donald Trump’s decision to postpone his ultimatum targeting Iran regarding the reopening of the Strait of Hormuz. Trump had initially warned of potential strikes against Iranian energy infrastructure if the strategic waterway remained blocked. He subsequently moved the deadline to Friday, then announced another extension on Thursday, pushing it to April 6.
In a Truth Social post, Trump indicated the deadline extension came following a request from Iran. He characterized negotiations between the nations as “ongoing” and proceeding “very well.” He dismissed contradictory media coverage as “erroneous.”
Tehran’s government has publicly refuted assertions that diplomatic negotiations with the United States are occurring.
Factors Behind Gold’s Weakness During the Conflict
Gold has experienced a decline exceeding 15% since the outbreak of hostilities between Iran and Israel approximately one month ago. This represents a substantial downturn for a commodity traditionally viewed as a refuge during geopolitical turmoil.
The primary catalyst is crude oil. The near-blockade of the Strait of Hormuz has driven petroleum prices substantially higher. Approximately one-fifth of global oil supplies transit through this critical passage. Elevated oil prices intensify inflation concerns, which subsequently lead market participants to anticipate central banks maintaining elevated interest rates for extended periods. Gold, as a non-yielding asset, typically underperforms in high-interest-rate conditions.
The precious metal also achieved record valuations near its January peaks, and several market observers suggest those elevated levels may have triggered profit-taking activity.
The greenback has also strengthened. The US Dollar Index registered a slight increase on Friday, trading around 99.99. A robust dollar elevates gold prices for international buyers using alternative currencies, potentially dampening demand.
Central Bank Liquidation Creates Additional Headwinds
Turkey’s monetary authority liquidated and exchanged roughly 60 tons of gold across a two-week span. The transaction represents more than $8 billion in bullion value.
Central bank accumulation had served as a fundamental pillar supporting gold’s multi-year rally. Divestment activity from a significant central bank creates downward momentum in the marketplace.
Silver remained relatively unchanged on Friday, trading at $68.11 per ounce. Both platinum and palladium registered modest gains.
Iran and Israel continued exchanging missile strikes on Friday. Tehran also launched attacks against multiple Gulf region nations during Friday morning hours.
