Gold prices tumbled on Monday, with the precious metal losing ground as investors shifted their focus from geopolitical uncertainty to concerns over inflation and tighter monetary policies.
The decline comes even as tensions in the Middle East intensify, with the US setting a strict deadline for Iran regarding a key oil shipping route. Tehran has responded with warnings of retaliation, raising fears of a broader regional conflict.
However, instead of driving demand for gold, the situation has fueled expectations of rising global inflation, particularly through higher energy costs. This has led markets to anticipate a more aggressive stance from central banks, including possible interest rate hikes.
Silver and platinum also weakened alongside gold, reflecting a broader pullback in the precious metals market. Analysts suggest that while short-term pressures remain, gold could regain momentum once inflation expectations stabilize.