Gold heads for biggest weekly loss since early June on inflation fears

Reuters

Saturday, July 18, 2026 1:5 | 2 minutes read

Gold prices rose on Friday but are heading for their biggest weekly loss in 6 weeks, as escalating tension between the United States and Iran pushed energy prices higher and fueled inflation fears, boosting expectations of a U.S. interest rate hike.

Spot gold rose 1% to $4011.29 per ounce by 1820 GMT.

Prices had earlier in the session fallen to their lowest since June 30, and they are also down about 2.6% this week.

At settlement, U.S. gold futures for August delivery rose 0.7% to $4018.80 per ounce.

The dollar rose for the second straight session, making the precious metal more expensive for buyers holding other currencies.

Read also: Oil jumps as tensions return between US and Iran over Strait of Hormuz

Chris Gaffney, head of global markets at EverBank, said: "The two main factors behind the selling wave in gold are the strength of the dollar and rising fears of global inflation, which pushed global interest rates higher."

The United States escalated its new military campaign against Iran, targeting bridges and an airport, while Tehran responded by launching attacks across the Middle East.

Brent crude prices rose about 16% during the week following those attacks.

Since the war on Iran erupted in late February, gold has fallen about 25% under pressure from expectations that war-induced inflation will keep interest rates higher for longer.

Read also: US launches strikes on Iran for seventh night, diverts course of 4 ships

Gold is typically seen as a hedge against inflation, but higher interest rates usually reduce appetite for the non-yielding metal.

The CME Group's FedWatch tool indicates that traders currently see a 58% probability of a rate hike in September.

Among other precious metals, spot silver rose 1% to $56.06 per ounce.

Platinum fell 1.4% to $1595.64 per ounce, and palladium settled at $1249.63. All three metals are heading for weekly losses.

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