Gold prices plunged on Thursday to their lowest level in nearly two months, as escalating tensions between the United States and Iran rattled markets, fueling inflation concerns and dimming hopes for interest rate cuts.
Spot gold dropped 1.5% to $3,388.76 per ounce by 07:40 GMT, touching its weakest point since March 26. US June gold futures also fell 1.4% to $3,386.
A surging dollar, climbing to a one-week high, added further pressure on the precious metal, making it more expensive for holders of other currencies.
Oil prices meanwhile surged over 3%, a development that could accelerate inflation and keep interest rates elevated for longer — a combination that continues to weigh heavily on gold’s appeal as a safe-haven asset.
