Gold prices moved higher on Thursday, rising to around $5,170 per ounce, as investors increasingly sought safety amid intensifying geopolitical tensions in the Middle East.
The precious metal extended gains from the previous session after the regional conflict entered its sixth day, with military activity escalating across the region. U.S. and Israeli forces reportedly struck multiple targets inside Iran, while Tehran responded with missile attacks on neighboring countries, including strikes that targeted key energy infrastructure.
The situation intensified further after President Donald Trump publicly backed the U.S. military campaign. U.S. officials also confirmed that an Iranian warship was sunk in international waters, marking another major development in the rapidly evolving conflict.
Meanwhile, Iranian authorities rejected reports that their intelligence ministry had contacted Washington to open negotiations, calling the claims false and reaffirming their position amid rising tensions.
Inflation Concerns Add Support to Gold
Beyond geopolitics, fresh economic developments also supported the precious metal.
The U.S. Treasury Secretary confirmed that a global 15% tariff will take effect this week, although officials indicated the measure could be reversed within the next five months depending on economic conditions.
At the same time, rising oil and natural gas prices linked to the conflict have reignited global inflation concerns. Higher energy costs could keep price pressures elevated, complicating the policy outlook for the Federal Reserve.
As a result, traders have pushed back expectations for U.S. interest-rate cuts, with the first reduction now widely anticipated around September. Markets are still pricing in two rate cuts in 2026, but the timeline remains uncertain as geopolitical risks and inflation pressures continue to evolve.
Market Outlook
Gold’s latest rally highlights its traditional role as a safe-haven asset during periods of geopolitical and economic uncertainty. If tensions in the Middle East continue to escalate or energy prices keep rising, analysts believe bullish momentum in gold could remain supported in the near term.
