Gold falls below $4,000/oz on strong dollar, hawkish Fed signals

Spot gold prices slipped below a key psychological level of $4,000 per ounce level for the first time ​since November 2025 on Wednesday, under pressure from ‌a firmer U.S. dollar and growing expectations that interest rates will remain elevated.

The U.S. dollar firmed, making dollar-priced bullion more expensive for ​holders of other currencies.

Traders have ramped up bets ​on U.S. interest rate hikes this year after ⁠the U.S. central bank struck a hawkish tone at ​its latest policy meeting and as fears of inflationary pressures ​stemming from the Iran war persisted.

"The market pricing a rate hike as soon as September due to a hawkish Fed, a surging dollar ​at 13-month highs combined with lower inflation expectations are ​putting heavy pressure on precious metals," Tai Wong, an independent metals trader, ‌said.

"For ⁠gold, there is support just under $3,900 and central bank purchases continue, so a collapse is unlikely, but expect a potentially long period of consolidation as the gold trade ​is now out ​of favor," ⁠he added.

Gold becomes less attractive to investors when interest rates rise because it offers ​no yield.

Spot gold, which scaled a record peak ​of $5,594.82 ⁠in late January, has since shed more than $1,500 an ounce.

ING analysts cut their gold forecasts, now expecting prices to average $4,300 ⁠an ​ounce in the third quarter of ​2026 and $4,600 in the fourth, compared with their previous projections of $4,850 and $5,000, ​respectively.