Market Overview

On Monday, 29 June 2026, gold prices fell sharply even as the U.S. dollar weakened. Spot gold was down 1.8% at $4,016.92 per ounce at 16:33 ET (20:33 GMT), while gold futures slipped 1.6% to $4,031.22 per ounce. The spot price marked a five‑week losing streak that began on Friday, and the futures contract recorded its fourth negative week in five.

Gold Price Movement

Last week gold briefly broke below the $4,000 level, reaching its lowest point since early November, before rebounding to just under $4,100 on Friday afternoon. The metal then drifted lower on Monday, and the weaker dollar was insufficient to lift prices. Senior market analyst David Morrison of Trade Nation noted that the key question is whether the current decline signals a longer‑term low, given a five‑month sell‑off from the January all‑time highs. He warned that a drop back under $4,000 could test the October lows just below $3,900, and that technical support would only be credible below $3,500. Morrison added that the daily MACD had re‑entered oversold territory, though not as deep as at the end of March.

Drivers: Geopolitics and Monetary Policy

The price weakness was attributed to a mix of renewed Middle‑East tensions and revived expectations of Federal Reserve rate hikes. Fresh strikes between the United States and Iran over the weekend reignited concerns about inflation and interest‑rate pressures. Oil prices rose after the latest exchange of strikes, which represented the most significant test of the cease‑fire since a memorandum of understanding was signed on 17 June.

Conflict Details

Iran reportedly seized the Singapore‑flagged cargo vessel Ever Lovely for deviating from Iranian‑monitored routes through the Strait of Hormuz. President Donald Trump called the attack a “foolish violation” of the U.S.–Iran cease‑fire and ordered U.S. strikes on Iranian missile and drone storage sites and coastal radar installations, according to U.S. Central Command (CENTCOM). CENTCOM later conducted additional strikes on Saturday in response to an Iranian attack on the Panama‑flagged tanker Kiku, which was transiting near the strait with more than 2 million barrels of crude oil. Iran’s state media said it retaliated with missile and drone strikes against eight U.S. military bases in the Gulf, including locations in Kuwait and Bahrain.

President Trump later said Iran had requested a meeting in Doha on Tuesday. White House Press Secretary Karoline Leavitt indicated that U.S. Special Envoy Steve Witkoff and Jared Kushner would travel to Doha, asserting that the United States was “holding up our end of the ceasefire.” Iran’s foreign ministry spokesperson Esmaeil Baqaei contradicted the claim, stating no negotiations were scheduled.

Monetary‑Policy Context

Gold’s decline was also linked to heightened expectations of Fed rate hikes, which typically depress non‑yielding assets and strengthen the dollar. However, the dollar weakened on Monday as market participants turned their attention to upcoming U.S. labor‑market data for clues on monetary policy. The Fed’s preferred inflation gauge (the PCE price index) posted its highest annual increase in May since October 2023, while the headline CPI recorded its highest annual rise since April 2023—both figures matching economists’ expectations. Despite these elevated readings, investors marginally trimmed their odds of further Fed hikes this year and slightly increased the probability of rates remaining steady, believing the May inflation numbers may represent a peak in price pressures as oil prices have fallen.

Upcoming U.S. Labor Data

Traders will watch a series of labor‑market releases later in the week for additional guidance on Fed policy. On Tuesday, April job‑openings data will be released, followed by ADP’s private‑employment report on Wednesday. The pivotal May non‑farm payrolls report is scheduled for Thursday. Strong employment numbers could reduce the Fed’s flexibility for policy easing.

Outlook

The combination of geopolitical risk, rising oil prices, and lingering inflation concerns continues to generate volatility in gold markets. While a weaker dollar offered some support, the prevailing focus on U.S. labor data and the potential for further Fed tightening keeps downward pressure on the metal.