On Monday, gold prices fell as the stagnation in U.S.-Iran peace talks contributed to a rise in oil prices, heightening concerns that ongoing inflation could lead to sustained high interest rates. Spot gold fell by 0.6% to $4,687.49 per ounce, as of 0038. U.S. gold futures for June delivery fell by 0.7%, closing at $4,696.60. The dollar has strengthened, leading to increased costs for bullion priced in greenbacks for holders of other currencies.

On Sunday, U.S. President Donald Trump rejected Iran’s response to a U.S. proposal for peace talks, dampening hopes for a quick resolution to the ongoing conflict that has lasted for ten weeks, causing considerable damage in Iran and Lebanon, disrupting maritime activities in the Strait of Hormuz, and driving up global energy prices. Oil prices increased by $3 a barrel on Monday as the Strait of Hormuz continued to be largely closed, putting pressure on global energy supplies.

The ongoing situation with Iran and its effects on oil prices and supplies have become a primary concern for financial stability, as noted in a semi-annual report from the Federal Reserve released on Friday. On Friday, Austan Goolsbee, President of the Federal Reserve Bank of Chicago, suggested that upcoming monetary policy could include raising interest rates. Meanwhile, China’s gold production saw a decrease in the first quarter of 2026 compared to the same period a year earlier, as reported, due to safety inspections that led some smelters to stop production for maintenance.

Gold demand in India showed weak performance last week, as rising prices caused potential buyers to postpone their purchases. At the same time, premiums in China held steady, supported by persistent safe-haven demand. Gold speculators raised their net long position by 4,090 contracts, resulting in a total of 95,664 for the week ending May 5. Spot silver held steady at $80.32 per ounce, platinum dipped by 0.9% to $2,037, and palladium decreased by 1% to $1,477.23.