Gold Price in Battle Between Two Major Forces: Everyone Beware
Jakarta — Gold and silver prices have finally recovered after a recent downturn. Prices improved after crude oil and the US dollar weakened.
According to Refinitiv data, gold closed at US$5,193.93 per troy ounce, surging 1.06% during Tuesday (10 March 2026) trading. This increase came as welcome news following a 0.64% decline on Monday.
Gold prices continued rising today. On Wednesday (11 March 2026) at 06:18 Western Indonesian Time, gold strengthened by 0.05% to US$5,193.93 per troy ounce.
Gold prices improved after crude oil weakened on Tuesday. The decline in oil prices also put downward pressure on the US dollar. The dollar index closed at 98.89 on Tuesday, down from its previous level of 99.18.
Gold is currently “in battle” between two competing market forces: geopolitical tensions pushing prices higher versus dollar strength constraining gains. Gold typically rises during geopolitical crises as investors seek it as a safe-haven asset. However, a strong US dollar can suppress gold prices, as it makes gold more expensive for buyers using other currencies.
The dollar index climbed to the 99 level on Monday, causing gold prices to collapse.
Gold began recovering following US President Donald Trump’s speech on Tuesday, which suggested the conflict would soon end. The speech immediately pressured oil prices. With oil prices weakening, US inflation is expected to ease, which could lead to potential interest rate cuts by the Federal Reserve. With greater probability of cuts, investors have sold the dollar, causing the index to weaken. Gold has therefore been able to rise again.
Interest rate cuts typically support assets such as gold, which generate no yield.
Before Trump’s speech, market participants believed the Federal Reserve might maintain or even raise interest rates to contain inflationary pressures from rising energy costs.
Analysts note that although oil prices have fallen, levels remain relatively high. This suggests inflation will likely persist at elevated levels, but not high enough to prevent the central bank from cutting rates this year. These conditions have provided some relief to investors regarding monetary policy direction.
Nevertheless, analysts emphasise that major shipping routes remain disrupted and energy prices remain far higher than before the conflict began, indicating risks continue to exist.
Despite volatile trading and slowing momentum gains since the decline from a record high in late January, gold prices have still recorded significant gains throughout the year.
“For gold traders, falling but still-elevated oil prices mean inflation will rise, but not high enough to prevent the US central bank from cutting interest rates this year,” said Bart Melek, head of global commodity strategy at TD Securities, to Reuters.
“Investors are starting to feel more comfortable that the currency debasement trade could strengthen again over time,” he added.
Today, gold investors await US inflation data. If inflation rises, the likelihood of rate cuts recedes, potentially causing gold to fall again.