Gold Prices Head for 0.8% Weekly Drop

Gold Prices Head for 0.8% Weekly Drop

Spot gold fell 0.7% to $4,181.86 per ounce as of 22:12 ET (02:12 GMT) on Friday, putting the metal on track for a 0.8% weekly decline—the third consecutive weekly drop. August U.S. gold futures were down 1.1% at $4,199.10.

The decline was driven primarily by a stronger U.S. dollar and a hawkish outlook from the Federal Reserve. The Fed left its policy rate unchanged at its latest meeting, but Chair Kevin Warsh’s remarks were read as decidedly hawkish, pushing Treasury yields higher and lifting the dollar to its strongest level in more than a year. The U.S. Dollar Index, after a 0.7% rise on Thursday to a peak not seen since May 2025, was largely flat during Asian trading.

Nine of the Fed’s 19 policymakers now expect at least one additional rate hike later in 2026, and futures markets price in more than an 80% probability of a year‑end rate increase. A firmer greenback raises the cost of dollar‑denominated bullion for overseas buyers, while higher rates increase the opportunity cost of holding non‑yielding assets such as gold.

The metal’s weakness came despite the formal signing of an interim peace agreement between the United States and Iran, which had earlier lifted sentiment and briefly boosted gold. The agreement is expected to reopen shipping through the Strait of Hormuz, leading to a steep decline in oil prices and easing concerns about energy‑driven inflation. Nevertheless, investors remained focused on the Fed’s renewed willingness to tighten policy if price pressures persist.

Among other precious metals, silver slipped 1.6% to $64.70 per ounce and platinum fell 1.3% to $1,677.51 per ounce, mirroring the broader decline in bullion.