Gold Prices: Iran Conflict, US Strikes & Forecasts (2024)

Gold prices stabilized Tuesday, trading around $2,320 per ounce, as investors assessed the potential for de-escalation in tensions between the United States and Iran. The precious metal, often viewed as a safe-haven asset, had experienced a significant sell-off in recent weeks despite escalating geopolitical uncertainty. This counterintuitive movement has prompted questions about the factors influencing gold’s performance, particularly in the context of the ongoing conflict and its impact on global markets.

The Correction in Context

Gold’s recent decline has been substantial. As of March 23, 2026, prices had fallen approximately 23% from a record high of $5,602 per ounce set on January 28, 2026, to around $4,320. Since the start of the Iran-US war on February 28th, the price has dropped roughly 14% from pre-war levels. This dip isn’t necessarily a reflection of waning confidence in gold itself, but rather a response to specific market dynamics, according to J. Rotbart & Co., a leading independent precious metals dealer. The firm maintains its year-end price target of over $5,605 per ounce, anticipating a rebound as inflationary pressures persist.

The primary driver behind the recent correction is the oil price shock triggered by Iran’s closure of the Strait of Hormuz. This disruption has led to a sharp increase in inflation expectations, prompting markets to reassess Federal Reserve policy. Instead of anticipated rate cuts, the expectation has shifted towards a prolonged pause in rate adjustments. Higher expected interest rates increase the opportunity cost of holding gold, which doesn’t offer a yield, making other investments comparatively more attractive. Adding to this pressure, the US dollar has strengthened by 2% since the start of hostilities, further weighing on gold prices.

Why the Safe Haven Didn’t Hold

The conventional wisdom dictates that geopolitical instability should drive investors towards safe-haven assets like gold. Still, the current situation presents a unique set of circumstances. As J. Rotbart & Co. Points out, similar episodes of energy-driven monetary repricing have historically resolved in gold’s favor once the underlying inflationary reality takes hold and economic growth slows. The firm believes this resolution is already underway.

Morningstar highlights the disconnect between geopolitical risk and gold’s performance, asking “Why Is Gold Falling Despite Iran War Uncertainty?”. The answer, they suggest, lies in the complex interplay of factors influencing market sentiment, including the Federal Reserve’s potential response to rising inflation and the strength of the US dollar.

The Impact on Investors

The recent volatility in gold prices has created both challenges and opportunities for investors. Those who purchased gold at or near its January peak have experienced significant losses. However, the current dip may present an entry point for investors who believe in the long-term value of gold as a hedge against inflation and geopolitical risk. J. Rotbart & Co. Specifically frames the current correction as a potential “best gold entry point” of the year.

The impact extends beyond individual investors. Gold mining companies have seen their stock prices decline alongside the price of gold, potentially affecting their profitability and investment plans. The broader precious metals market has also been affected, with silver and platinum experiencing similar downward pressure. Yahoo Finance Singapore reports that J. Rotbart & Co. Is actively advising investors on strategic allocations to physical gold, emphasizing long-term wealth preservation and jurisdictional resilience.

The Broader Market Context

Gold’s performance is also intertwined with broader market trends. The stock market has remained relatively resilient despite the geopolitical tensions, supported by strong corporate earnings and positive economic data. This has reduced the demand for safe-haven assets like gold, as investors are willing to take on more risk. However, any significant deterioration in economic conditions or a further escalation of the conflict could quickly reverse this trend.

Bloomberg notes that gold has been a “terrible Iran war hedge”, highlighting the limitations of relying on traditional safe-haven assets in the current environment. The article points to the complex interplay of factors, including the oil price shock, Federal Reserve policy, and the strength of the US dollar, as contributing to gold’s underperformance.

What to Watch Next

Several key factors will influence gold’s trajectory in the coming weeks and months. The most important is the evolution of the Iran-US conflict. Any signs of de-escalation could further dampen demand for gold, while a significant escalation could trigger a renewed surge in prices. Investors will also be closely monitoring inflation data and Federal Reserve policy decisions. A sustained increase in inflation could prompt the Fed to reconsider its pause on rate hikes, potentially boosting gold’s appeal. Finally, the performance of the US dollar will continue to play a crucial role, with a weaker dollar generally supporting gold prices.

Looking ahead, J. Rotbart & Co. Is hosting discussions for investors interested in implementing strategic allocations to physical gold. The firm emphasizes the importance of structuring these allocations for long-term wealth preservation and jurisdictional resilience, suggesting a proactive approach to navigating the current uncertain environment.