Spot gold rose 0.5% to $4,513.54 per ounce after hitting its lowest level since November early last week. U.S. gold futures for April delivery gained $115.30 to settle at $4,524.30.
“The war is still running hot and there’s no resolution in sight and that’s pushing gold prices higher due to safe-haven demand... Market focus in the near-term will be on the war, crude oil prices, bond yields, and the U.S. dollar index,” said Jim Wyckoff, senior analyst at Kitco Metals. Iran fired waves of missiles at Israel and vowed to “punish the aggressor” as Israeli forces pounded Tehran, while oil prices rose after Yemen’s Houthis entered the conflict.
Gold has fallen more than 13% so far in March, putting the metal on track for its worst monthly performance since 2008, as surging energy prices have heightened inflation concerns, prompting markets to reassess their interest rate expectations.
Gold is often used as a hedge against inflation and geopolitical uncertainty but does not yield interest, making it less attractive when interest rates remain high.
A series of economic data is due this week, including U.S. job openings, retail sales, the ADP employment report and nonfarm payrolls.