Global Gold Prices Fall Slightly, Pressured by Inflation Concerns from Middle East Conflict
NEW YORK — Global gold prices weakened at the close of trading on Monday (16 March 2026) local time, or early Tuesday morning (17 March 2026) Jakarta time, amid concerns about rising inflation stemming from Middle East conflicts that could keep interest rates elevated.
According to Reuters, spot market gold prices fell slightly 0.5 per cent to $4,993.42 per ounce, after touching their lowest level since 19 February at the beginning of the trading session.
Meanwhile, US gold futures contracts for April delivery weakened 1.2 per cent to $5,002.20 per ounce.
The decline in gold prices occurred despite the US dollar weakening from its highest position in the past 10 months. A weaker US dollar typically makes gold cheaper for holders of other currencies and increases interest in the precious metal.
However, concerns that oil price spikes from the Middle East war will trigger inflation and cause the US Federal Reserve to maintain high interest rates have dampened interest in gold.
“With higher oil prices, inflation will also increase. If inflation rises, the central bank will not be as enthusiastic as six months ago about cutting interest rates, and that becomes negative sentiment for gold prices,” said senior market strategist at RJO Futures, Bob Haberkorn.
“But I remain very optimistic about gold given what is happening around the world. Many funds are still waiting on the sidelines to enter the market, and I still estimate gold prices could reach $6,000 per ounce,” Haberkorn added.
Gold is typically viewed as a safe-haven asset or hedge against inflation and economic uncertainty. However, in an environment of high interest rates, gold’s appeal tends to diminish because investors prefer assets that provide returns.
Meanwhile, oil prices did fall during Monday’s trading, but overall they have risen more than 60 per cent during the year to date.
This increase in energy prices is occurring amid a conflict between the United States and Israel against Iran that has entered its third week with no signs of an imminent end.
On the other hand, market participants are also anticipating several important data releases and agendas from the US this week, including Producer Price Index data, Federal Reserve monetary policy decisions, remarks from Federal Reserve Chair Jerome Powell, and weekly jobless claims figures.
The Federal Reserve is expected to maintain its benchmark interest rate at its meeting scheduled for Tuesday through Wednesday local time.
For other precious metals, spot market silver prices remained relatively stable at $80.52 per ounce. Platinum prices strengthened 3.9 per cent to $2,103.42 per ounce, while palladium rose 3.1 per cent to $1,598.80 per ounce.