Bengaluru, March 3, 2026, 21:50 IST
- Spot gold fell 5.6% to $5,029.59/oz, retreating from a four-week high, as the dollar and Treasury yields rose
- War risk in the Middle East lifted safe-haven demand, but oil-led inflation worries pushed rate-cut bets further out
- Silver, platinum and palladium also slid sharply in a broad pullback across precious metals
Gold prices slid more than 5% on Tuesday, reversing from a four-week high as a stronger U.S. dollar and rising bond yields blunted demand for the safe-haven metal. Spot gold was down 5.6% at $5,029.59 an ounce by 1450 GMT, while U.S. gold futures fell 5.1% to $5,041.50. Reuters
The move matters because markets are trying to price two shocks at once. The Iran conflict has kept investors reaching for assets seen as safer when risk jumps, but the same conflict has driven energy costs higher and revived inflation fears.
That inflation angle is what has started to bite gold. Higher yields raise the appeal of interest-paying assets, and gold does not pay interest, so it can lose ground when traders think central banks will keep rates higher for longer.
“The move lower in gold appears to be driven by a flight to liquidity – a flight to cash. We have a strong dollar and bond yields trading higher,” said Bob Haberkorn, senior market strategist at RJO Futures. He added the dip could be brief if the conflict keeps investors nervous and looking for cover.
The dollar, which also acts as a haven in periods of stress, rose to an over one-month peak, making dollar-priced bullion more expensive for buyers using other currencies. U.S. Treasury yields climbed for a second straight session.
Fighting in the Middle East entered a fourth day, with explosions reported in Tehran and Beirut, and a senior Iranian Revolutionary Guards official said on Monday the Strait of Hormuz had been closed. Oil benchmarks jumped more than 8% on Tuesday, adding to inflation pressure, the Reuters report said.
Fawad Razaqzada, a market analyst at City Index and FOREX.com, pointed to the risk that damage to energy infrastructure and disruption around Hormuz keeps oil, gas and refined products elevated. That, he said, can push rate-cut expectations further out, leaving gold with less support.
Gold had been drawing strong safe-haven interest earlier in the week, with futures prices touching the $5,400 area before gains thinned out, Yahoo Finance reported. https://finance.yahoo.com/news/gold-touches-5400-as-demand-for-safe-haven-asset-jumps-amid-iran-conflict-102241256.html
Bloomberg described Tuesday’s drop as a war-risk premium meeting a firmer dollar and higher yields, a mix that can sap demand even when geopolitical headlines are loud. https://www.bloomberg.com/news/articles/2026-03-03/gold-slumps-as-strong-dollar-yields-offset-war-risk-premium
Even after the slide, gold was still up 17% so far this year, after a 64% surge in 2025. Silver, up nearly 12% in 2026 before Tuesday, fell 11.2% to $79.42 an ounce.
Other precious metals sank with gold. Platinum dropped 12.6% to $2,013.65 an ounce and palladium lost 8% to $1,624.50.
The risk for gold bulls is that higher energy prices keep inflation sticky and rates elevated, keeping the dollar supported and limiting any bounce. The flip side is that a wider disruption around oil shipments or fresh escalation could pull investors back toward gold quickly, even if yields stay firm.
