On Tuesday, March 17, during early Asian trading, international gold prices held steady above a key level. Market analysts noted that current focus remains centered on oil price movements, developments in the U.S.-Israel conflict with Iran, and multiple central bank meetings scheduled for the week, all of which are collectively shaping recent gold price fluctuations. In the previous trading session, gold briefly fell below the critical $5,000 per ounce mark before gradually recovering above it, supported by declining oil prices that eased inflation concerns, demonstrating underlying market support.
A cooling U.S. dollar also provided a boost to gold prices. After two consecutive weeks of strong gains, the dollar retreated, falling 0.5% on the day. A weaker dollar typically enhances the appeal of gold as a non-dollar asset, indirectly supporting its recovery. Meanwhile, oil prices dropped sharply on Monday, partly due to profit-taking and reports of several vessels passing safely through the Strait of Hormuz, alleviating fears of energy supply disruptions. This further reduced inflation pressures stemming from the Iran conflict, creating favorable conditions for gold's rebound. It is worth noting that since the outbreak of the Iran conflict, gold's safe-haven appeal has not been fully realized, with its overall performance falling short of market expectations. The primary reason is that war-induced inflation concerns have heightened expectations that major central banks will maintain high interest rates, which has largely offset gold's safe-haven demand.
This week, global financial markets will enter a period of intensive central bank policy activity, which will be a key variable influencing gold prices. The Reserve Bank of Australia will hold its monetary policy meeting on Tuesday, followed by the Federal Reserve and the Bank of Canada the next day. The Bank of Japan, Swiss National Bank, Bank of England, and European Central Bank will announce their interest rate decisions on the following day. Market participants generally worry that if inflation pressures from the Iran conflict persist, major central banks may adopt more hawkish monetary policies, keeping interest rates elevated for an extended period, which would continue to weigh on gold prices. Conversely, if central banks signal a more dovish stance, it could provide upward momentum for gold.
In the short term, gold prices are expected to continue fluctuating around the $5,000 per ounce level, with developments in the Iran conflict, oil price trends, and central bank policy decisions serving as core influencing factors. Investors are advised to closely monitor this week's central bank interest rate decisions and policy statements, while also tracking the situation in Iran and oil price movements to manage investment risks appropriately. Despite gold's safe-haven demand being partially offset by inflation concerns, its long-term value as a core safe-haven asset remains intact. Should geopolitical tensions escalate further or central bank policies shift toward easing, gold prices could see a new round of upward movement.
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