--- title: "Gold Trading Reminder: Renewed Conflict in the Middle East Drives Up Inflation! Gold Prices Continue to Fall, Approaching the 200-Day Moving Average, Is It \"Picking Up People in Reverse\" or the Start of a Bear Market?" type: "News" locale: "en" url: "https://longbridge.com/en/news/288640426.md" description: "Affected by the escalation of conflicts in the Middle East, which has pushed up oil prices and inflation expectations, the probability of interest rate hikes in the market has increased, leading to a stronger US dollar index. On Wednesday, international gold prices significantly corrected by 1.2%, with spot gold closing at $4,434.25 per ounce, approaching the support of the 200-day moving average. Although under pressure in the short term, geopolitical uncertainty still provides long-term safe-haven support. Investors need to pay attention to non-farm payroll data and the progress of ceasefire negotiations" datetime: "2026-06-03T23:37:19.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/288640426.md) - [en](https://longbridge.com/en/news/288640426.md) - [zh-HK](https://longbridge.com/zh-HK/news/288640426.md) --- # Gold Trading Reminder: Renewed Conflict in the Middle East Drives Up Inflation! Gold Prices Continue to Fall, Approaching the 200-Day Moving Average, Is It "Picking Up People in Reverse" or the Start of a Bear Market? **Huitong Finance News——** On Wednesday, influenced by the escalation of conflicts in the Middle East, international gold prices significantly corrected by 1.2%, with spot gold closing at $4,434.25 per ounce. U.S. airstrikes near the Strait of Hormuz and Iran's attacks on Kuwait led to oil prices soaring to around $96 per barrel, raising inflation expectations. The probability of a Federal Reserve interest rate hike has increased significantly, and the U.S. dollar index has reached a nearly two-month high. Despite short-term pressure, the uncertainty in the Middle East and the long-term safe-haven attributes continue to support gold. Investors should pay close attention to the non-farm payroll data and ceasefire negotiation progress this Friday. **Huitong Finance APP News——** On Wednesday (June 3), the international gold market experienced a significant correction. It fell by 1.2%, closing at $4,434.25 per ounce, with the 200-day moving average support currently around $4,422.42 per ounce; U.S. gold futures also fell by 1.2%, reported at $4,466.90. This decline is particularly noticeable amid the recent high volatility in gold prices. The core force driving the decline in gold prices is not the fading of safe-haven sentiment, but rather the "reverse logic" brought about by the escalation of conflicts in the Middle East: war drives up energy prices, exacerbates inflation expectations, and thus strengthens the market's bets on the Federal Reserve maintaining high interest rates or even raising them. As a non-yielding asset, gold is naturally pressured in a high-interest-rate environment. When the dollar strengthens and real yields rise, the opportunity cost of holding gold significantly increases. This time, the geopolitical conflict not only failed to bring traditional safe-haven buying but also created additional downward pressure on gold prices through the inflation transmission pathway. ## Escalation of Middle East Situation: Energy Crisis and the Return of Inflation Ghost The current tensions in the Middle East have once again become the market focus. The U.S. has conducted airstrikes near the Strait of Hormuz, while Iran has launched attacks on Kuwait, damaging local airports and causing casualties. Diplomatic efforts aimed at calming the conflict are currently making limited progress, with negotiations between Iran and the U.S. at a standstill. Iranian Foreign Minister Amir-Abdollahian has made it clear that if Israel continues its actions against Beirut, Iran will resume hostilities. David Meger, Director of Precious Metals Trading at High Ridge Futures, pointed out that the volatility in the gold market is primarily driven by U.S.-Iran tensions. As the conflict intensifies, rising energy prices have become inevitable, which will significantly boost global inflation expectations. Oil prices rebounded sharply on Wednesday, with U.S. crude oil futures rising 2.4% to $96 per barrel, reaching $97.77 per barrel. This energy shock is rapidly transmitting to the service and manufacturing sectors. ## Strong U.S. Economic Data: Complete Reversal of Federal Reserve Rate Cut Expectations In addition to geopolitical factors, the strong performance of domestic economic data in the U.S. further solidifies high interest rate expectations. Data from the Institute for Supply Management (ISM) shows that the service sector input price index rose to a nearly four-year high in May, with companies generally reporting soaring costs for oil-related products. Several companies mentioned increases in fuel surcharges and resin product costs, planning to pass these costs onto consumers The war has lasted for three months, and the disruption to the commodity supply chain has far exceeded expectations, contrasting sharply with the "peace dividend" that the market anticipated before the outbreak of the conflict. The ADP National Employment Report released on Wednesday showed that in May, U.S. private sector jobs increased by 122,000, exceeding the market expectation of 117,000. The previous April data also indicated a significant increase in job vacancies. The services PMI rose from 53.6 to 54.5, above expectations, with new orders and inventory indicators rebounding significantly. Factory orders surged 4.8% month-on-month, marking the largest increase in a long time. John Williams, President of the New York Federal Reserve, stated that current monetary policy is "just right," and the inflationary risks triggered by the Middle East conflict are not expected to be persistent, thus there is no need to adjust interest rates immediately. However, the market is not entirely convinced. On Wednesday, it rose 0.32% to 99.55, refreshing a nearly two-month high. The market has fully priced in an expectation of about 19 basis points of rate hikes by the Federal Reserve before December, and the probability of a 25 basis point hike before March next year has also been fully reflected. SEB macro strategist Gustav Helgesson believes that the upcoming May non-farm payroll data will be a key indicator. If the data remains strong, it may prompt the Federal Reserve to shift from its current easing bias and initiate discussions on a new rate hike cycle. This would support the dollar while exerting continuous pressure on gold. ## Political Variables: Congressional Constraints and the Dawn of Ceasefire Domestically in the U.S., the Trump administration faces congressional resistance. The House of Representatives passed a Democrat-led resolution on Wednesday by a vote of 215 to 208, demanding that military actions against Iran continue only with congressional approval. Although the resolution is more symbolic than practically effective (it requires Senate approval and a two-thirds majority to overcome a veto), it reflects the growing concerns within Congress about the continuation of the war. On the other hand, the market has also caught a glimmer of easing signals. Following the latest talks between Lebanon and Israel, a joint statement was issued agreeing to restart dialogue, establish a pilot zone for a ceasefire, and push for Hezbollah to withdraw from areas south of the Litani River. If this process makes substantial progress, it could alleviate some energy supply concerns and provide temporary support for gold prices. On June 4th, during the Asian market's early session, gold prices slightly rebounded to around $4,450, indicating that some bargain hunters have begun to enter the market. ## Gold Market Outlook: Short-term Pressure, Long-term Allocation Value Overall, gold is currently facing an unfavorable combination of "war driving up inflation → interest rates remaining high → dollar strengthening," leading to continued short-term pressure. The yield on 10-year U.S. Treasury bonds has risen to 4.489%, and the two-year yield has also increased, with the yield curve steepening, reflecting the market's dual pricing of economic resilience and inflationary pressures. However, from a longer-term perspective, the safe-haven and anti-inflation properties of gold have not disappeared. The prolonged uncertainty of the Middle East situation still exists, and if energy prices remain high or the conflict expands further, gold may regain favor. Additionally, the trend of global central banks purchasing gold and the fragmentation of geopolitical landscapes continue to play a positive role in the medium to long term For investors, it is crucial to closely monitor the U.S. non-farm payroll data this Friday, the diplomatic progress in the Middle East, and the trends in oil prices. If the non-farm data is unexpectedly strong and there are no substantial breakthroughs in the ceasefire negotiations, gold prices may continue to test lower support; conversely, if geopolitical tensions ease, gold is expected to undergo a technical rebound. The gold market is currently in a fierce contest among geopolitical factors, inflation expectations, and monetary policy. Short-term volatility is intensifying, but the strategic allocation value remains noteworthy. Investors should remain cautious and dynamically track key data and event developments. ( Daily chart, source: Easy Forex) At 07:34 Beijing time, it is reported at $4,449.90 per ounce ### Related Stocks - [03170.HK](https://longbridge.com/en/quote/03170.HK.md) - [SGOL.US](https://longbridge.com/en/quote/SGOL.US.md) - [09081.HK](https://longbridge.com/en/quote/09081.HK.md) - [82840.HK](https://longbridge.com/en/quote/82840.HK.md) - [518850.CN](https://longbridge.com/en/quote/518850.CN.md) - [09840.HK](https://longbridge.com/en/quote/09840.HK.md) - [GLDM.US](https://longbridge.com/en/quote/GLDM.US.md) - [IAU.US](https://longbridge.com/en/quote/IAU.US.md) - [02840.HK](https://longbridge.com/en/quote/02840.HK.md) - [GOLD.AU](https://longbridge.com/en/quote/GOLD.AU.md) - [GLD.US](https://longbridge.com/en/quote/GLD.US.md) - [UGL.US](https://longbridge.com/en/quote/UGL.US.md) - [03081.HK](https://longbridge.com/en/quote/03081.HK.md) - [83081.HK](https://longbridge.com/en/quote/83081.HK.md) - [03418.HK](https://longbridge.com/en/quote/03418.HK.md) - [ADP.US](https://longbridge.com/en/quote/ADP.US.md) ## Related News & Research - [PRECIOUS-Gold slips from two-week high on firmer dollar; Fed minutes in focus](https://longbridge.com/en/news/291782878.md) - [PRECIOUS-Gold eases from two-week high as firmer US dollar weighs](https://longbridge.com/en/news/291755529.md) - [$100 Invested In SPDR Gold Shares 5 Years Ago Would Be Worth This Much Today](https://longbridge.com/en/news/291822705.md) - [The War Came Back. 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