Gold Prices Head for Weekly Loss as Iran War Fuels Inflation Fears

Gold prices moved toward a weekly decline as escalating conflict involving Iran increased concerns about global inflation through rising energy prices. While geopolitical tensions typically boost demand for safe-haven assets, stronger US Treasury yields and a firmer dollar limited gains in bullion markets.

Energy markets have been particularly volatile as the conflict threatens supply routes and production across the Middle East. Oil prices briefly surged above the $100 per barrel level as disruptions and security risks in the region raised fears of a prolonged supply shock.

Higher energy prices have reinforced concerns that global inflation could remain elevated for longer. That outlook has pushed bond yields higher and strengthened the US dollar, both of which tend to weigh on gold because the metal does not provide interest income.

As a result, spot gold drifted toward roughly $5,100 per ounce and remained on track for a weekly loss. Analysts say the precious metal is currently caught between safe-haven demand driven by geopolitical tensions and pressure from rising yields and a stronger dollar, suggesting volatility may persist in the near term.