Gold prices held steady on Friday, but were on track for a fourth straight weekly drop, as increasing energy costs from the Middle East conflict raised inflation concerns and bolstered expectations for sustained high global interest rates. Spot gold held steady at $4,380.39 per ounce as of 0101. Bullion has dropped more than 2% so far this week. U.S. gold futures for April delivery held steady at $4,375.

Gold has decreased by about 17% since the U.S.The conflict between Israel and Iran began on February 28, driven by the rise of the U.S. dollar, which has increased by more than 2% in this period. Brent crude stayed high above $105 a barrel, raising worries about inflation, as the continuing conflict has significantly hindered shipments through the Strait of Hormuz, an essential route that represents about one-fifth of global crude and LNG flows. Rising oil prices present a threat of higher transportation and manufacturing costs, which could intensify inflationary pressures. Although inflation typically boosts gold’s appeal as a safeguard, high interest rates create a negative impact on the demand for this asset that does not generate income.

Traders have fully dismissed any expectations for Federal Reserve easing in 2026, differing from earlier predictions of two cuts before the start of the Iran conflict, as indicated by the CME Group’s FedWatch Tool. U.S. President Donald Trump announced his intention to extend the halt on strikes against Iran’s energy infrastructure until April, stating that negotiations with Iran were moving forward positively. Nonetheless, an Iranian official described the U.S. proposal to resolve the conflict as “biased and unjust.”

U.S. data showed a slight rise in jobless claims last week, indicating a labor market that continues to be stable. This situation allows the Federal Reserve to sustain existing interest rates while monitoring inflationary pressures linked to the ongoing conflict. Spot silver decreased by 0.8%, settling at $67.47 per ounce. Spot platinum fell by 0.2% to $1,823.40, while palladium rose by 1.3% to $1,370.75.