Gold slips as oil surge delays U.S. rate cut expectations
Rising energy prices and inflation concerns are weighing on gold, pushing the metal toward its second consecutive weekly decline.
Gold prices are on track for a second consecutive weekly decline as rising energy prices linked to the Middle East conflict reshape expectations for U.S. monetary policy. Spot gold rose slightly on Friday, trading about 0.3 percent higher at $5,095.55 per ounce during early trading hours. However, U.S. gold futures for April delivery slipped 0.1 percent to $5,100.20 , leaving the precious metal under pressure for the week. The decline reflects shifting investor expectations. While geopolitical tension typically supports safe-haven assets such as gold, the recent surge in oil prices has increased concerns about global inflation, which could delay interest-rate cuts by the U.S. Federal Reserve. Oil surge complicates monetary policy expectations The sharp rise in energy prices has become the dominant factor influencing market sentiment. Oil prices surged above $100 per barrel amid disruption to shipping routes and fears over supply in the Middle East. Higher oil prices tend to push inflation upward because energy costs feed directly into transportation, manufacturing, and consumer goods. That dynamic forces central banks to maintain tighter monetary policy for longer. For gold investors, this creates a mixed environment. Gold benefits from geopolitical uncertainty, but it struggles when interest rates remain elevated because higher yields increase the opportunity cost of holding non-yielding assets. Key forces shaping the gold market Several factors are currently influencing gold’s short-term performance: Rising oil prices , which increase inflation expectations. Delayed interest-rate cut expectations in the United States. Geopolitical uncertainty linked to the Middle East conflict. Safe-haven demand , which still supports gold during periods of global instability. What investors are watching next Investors are closely monitoring signals from the U.S. Federal Reserve , particularly any indication of when interest-rate cuts could begin. Monetary policy expectations rema