Gold is set to record its first weekly loss in June, as easing tensions in the Middle East and a cautious Federal Reserve outlook reduce demand for the precious metal. On Friday, gold traded near $3,350 an ounce, down over 2% for the week.
The risk of a U.S. military escalation in the Middle East has lessened after President Donald Trump’s spokeswoman said he would decide within two weeks whether to join Israel’s attacks on Iran. This lowered fears of a conflict that could disrupt energy supplies and push inflation higher.
At the same time, Federal Reserve Chair Jerome Powell warned that inflation risks remain due to the impact of U.S. tariffs. This could limit the Fed’s ability to cut interest rates, which typically supports gold since it does not pay interest and benefits from lower borrowing costs.
Despite this week’s pullback, gold remains up more than 25% this year and close to its record peak above $3,500 set in April. However, some investors are shifting interest toward platinum as an alternative safe haven amid gold’s high price levels.
Wall Street analysts are divided on gold’s future. Goldman Sachs maintains a bullish outlook, forecasting gold could reach $4,000 an ounce by next year. Conversely, Citigroup predicts prices might fall below $3,000 in 2026.
On Friday morning in London, spot gold fell 0.6% to $3,351.53 an ounce. The Bloomberg Dollar Spot Index slipped slightly but stayed higher for the week. Silver and platinum prices declined, while palladium saw gains.
Related topics:
