Gold extends sharp slide as rate fears intensify

Global gold prices fell sharply again overnight, marking a seventh consecutive day of losses, as investors grew increasingly concerned that central banks around the world, including the US Federal Reserve, would maintain tight monetary policy to contain inflation stemming from the prolonged Iran conflict.

Reuters reported that gold dropped more than 4% on Thursday, March 19, 2026, as the conflict in the Middle East drove oil prices higher and reignited fears of inflation, strengthening expectations that leading central banks would keep borrowing costs elevated.

Spot gold fell 4.3% to $4,612.21 per ounce as of 1.31pm US Eastern Time, or 5.31pm GMT, its lowest level since early February. US gold futures for April delivery closed down 5.9% at $4,605.70 per ounce.

Daniel Ghali, a commodities strategist at TD Securities, said gold is now widely held by institutional investors after the currency weakness seen over the past year, but added that the foundations of that trade are beginning to weaken. He said there were still downside risks in the near term and that prices had further room to fall while the broader bull-market structure remained intact.

Gold is often regarded as a hedge against inflation and geopolitical turmoil. However, because it does not generate interest, it tends to lose appeal when interest rates remain high.

Most developed-market central banks left interest rates unchanged this week, but stressed that they remained ready to respond if inflation worsened as a result of the energy shock caused by the war involving the United States, Israel and Iran. The Fed kept rates steady and signalled only one cut this year, while other major central banks also struck a cautious tone.

Brent crude surged above $110 a barrel after Iranian attacks on energy facilities across the Middle East, in retaliation for Israeli strikes on Iran’s South Pars gas field. Reuters separately reported that oil had briefly climbed as high as $119 before pulling back.

At the same time, US officials and other people familiar with the matter said President Donald Trump’s administration was considering sending thousands more American troops to reinforce operations in the Middle East, as the Iran war risked entering a new phase.

Analysts at SP Angel said gold was also being pressured by profit-taking and earlier dollar strength. They noted that after gold’s strong rally in 2025, it was not surprising that traders were locking in gains to meet margin calls and rotate funds into new opportunities, including hydrocarbon energy stocks, amid renewed market volatility. Reuters also reported that gold’s drop came after it broke below the key $5,000 level earlier this week.

Other precious metals also fell. Spot silver dropped 5.3% to $71.39 per ounce, platinum fell 3.7% to $1,949.20, and palladium slipped 2.4% to $1,440.29.

In the latest market update on the morning of March 20, spot gold was little changed at $4,640.85 per ounce during Singapore trading, after posting its longest losing streak since October 2023 on Thursday. Silver hovered at about $72 an ounce and was down roughly 10% for the week, while palladium and platinum were also heading for weekly declines.