Gold fell early Friday and headed for a weekly loss on a strong dollar and as high oil prices from the war in Iran increased speculation that the Federal Reserve will have to increase interest rates.
The U.S. currency traded near a six-week high heading into the long holiday weekend, with the elevated levels making dollar-denominated gold more expensive for holders of other currencies. Reports that Iran and Oman are in discussions to charge a toll for vessels going through the Strait of Hormuz, a critical artery for the oil industry, is being read as a signal that peace talks aren’t going well and that inflation may increase for some time.
June gold futures rose 0.2% Thursday to $4,542.50 an ounce on Comex, and the most-active contract declined 0.4% in the first four days of the week. Bullion dropped 1% last month after sliding 11% in March and climbing 11% in February. It rallied 64% last year. The June contract is currently down $22.50 (-0.50%) an ounce to $4520.00 and the DG spot price is $4522.70.
U.S. markets will be closed Monday for the Memorial Day holiday. Electronic trading on Comex that day will post for Tuesday’s settlement.
Gold has largely fallen on signals that the war may be extended and that inflation isn’t likely to be reined in for some time. The Iran war has erased expectations that the Fed would cut interest rates this year, with more and more investors now forecasting a rate increase instead. High interest rates are typically considered bearish for precious metals.
The Fed last month held interest rates steady at 3.5% to 3.75%, as expected, but policymakers were unusually divided. Almost all the investors tracked by the CME FedWatch Tool are betting on rates staying unchanged again in June.
U.S. President Donald Trump is set to swear in Kevin Warsh, his nominee, as Fed chair at the White House on Friday. Trump has long called for lower interest rates, but rising inflation may get in the way of that. Last week, showed that two key inflation measures for April, the consumer price index and producer price index, increased sharply.
The Fed has kept interest rates unchanged this year after three previous rate cuts. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts in 2024.
Front-month silver futures rose 0.7% Thursday to settle at $76.73 an ounce on Comex, and the July contract tumbled 1.1% in the first four days of the week. The most-active contract touched a record above $115 in January. Silver lost 1.2% in April after dropping 20% in March and gaining 19% in February. It rose 141% last year. The July contract is currently $0.757 (-0.99%) an ounce $75.975 and the DG spot price is $75.86.
Spot palladium gained 1.5% Thursday to $1,403.00 an ounce and has lost 1.7% so far this week. Palladium rose 3.2% last month after tumbling 17% in March and gaining 8.8% in February. Palladium rose 74% last year. Currently, the DG spot price is down $22.90 an ounce to $1367.00.
Spot platinum increased 0.7% Thursday to $1,974.60 an ounce and has dropped 0.9% this week. It gained 1.3% in April after declining 17% in March and advancing 15% in February. Platinum increased 122% in 2025. The DG spot price is currently down $24.50 to $1939.30.
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