Gold prices fell on Friday, putting the market on track for a weekly decline as higher oil prices and escalating U.S.-Iran tensions revived inflation concerns. At 16:50 ET (20:50 GMT), spot gold was down 0.2% at $4,114.45 per ounce, while gold futures slipped 0.5% to $4,122.47 per ounce. Both contracts were approximately 1.6% lower for the week.
Oil markets also moved, with Brent crude (LCO) down 0.38% and U.S. crude (CL) down 0.79%, reflecting the premium added by the geopolitical risk after Iran’s reported attacks on three commercial oil tankers in the Strait of Hormuz. Traffic through the strait declined as shippers grew cautious, further supporting higher oil prices.
The price action occurred against a backdrop of heightened monetary‑policy uncertainty. Federal Reserve minutes from the June 16‑17 meeting revealed an evenly split debate among policymakers on the outlook for rates. The Fed’s report to Congress, released the same day, highlighted continued concerns about inflationary pressures stemming not only from the Middle‑East conflict but also from artificial‑intelligence‑driven demand and tariff impacts.
Analysts at ANZ noted that gold found some support from expectations of limited escalation in the Middle‑East, despite earlier worries that a rebound in energy prices could compel the Fed to keep interest rates higher for longer. The market now looks ahead to key U.S. inflation data: the consumer price index (CPI) for June is scheduled for Tuesday, followed by the producer price index (PPI) for the same month on Wednesday.
President Donald Trump amplified the geopolitical narrative, stating on Truth Social that the cease‑fire with Iran was “over” and that Iran had called to “make a deal so badly.” Oman and Pakistan, acting as chief mediators, urged calm and continued negotiations, signaling that neither side sought a full‑scale escalation.
Overall, the combination of rising oil prices, geopolitical tension, and a divided Fed stance has placed gold on a trajectory toward weekly losses, while upcoming U.S. inflation releases are expected to shape further market direction.