Spot gold, in its worst weekly loss since 1983, crashed 10.52% in the week ending March 20. (AI image)
Gold price prediction
today:
Gold prices
are likely to remain range-bound in the near future, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan.
Gold Performance:
Gold prices underwent a violent swing on Monday as traders reacted to evolving developments on the Iran war front and even wilder swings in oil prices. On March 23, gold crashed to $4099, the lowest since November 24, 2025, as global yields and oil prices moved higher supporting the US Dollar on rising inflation risks.
Gold recovered strongly to $4500 as the US President signalled his willingness to de-escalate. The President, backing down from his threat to destroy Iran's power infrastructure if it didn't reopen the Strait of Hormuz within 48 hours, instructed US forces to postpone all strikes against Iranian energy infrastructure for a five-day period. He added that representatives from Iran reached out to start talks but Iran has denied any such talks.
At the time of writing this article, the metal was trading with a loss of around 3% at $4370.
Spot gold, in its worst weekly loss since 1983, crashed 10.52% in the week ending March 20 as central banks flagged inflation risks leading to sharp rise in rate hike possibility.
The yellow metal closed with a daily loss of 3.45% at $4491 on March 20 as it extended its decline to the eighth straight day.
It has dropped every week since the US and Israel attacked Iran on February 28.
Oil and geopolitics:
It has been reported that before President Trump’s attempt to ease the Iran tensions, US allies and Gulf countries had privately warned him of the dangers of following through with his threat to Iran. He had been told that permanent damage to Iranian infrastructure would almost inevitably result in a failed state after the conflict ended.
Risks in Trump’s offramp attempt: Trump's offramp attempt has increased the risk that Iran, seeing the success of its strategy to attack the US’s and Israel’s energy infrastructures in the Middle East, will be emboldened further if talks fail to bring about the desired results. In fact, Iran could target any power structures in the region. Moreover, the US and Israel will continue to strike on military sites in the country. Uncertainty around Israel's strategy and intentions abound. Earlier, Iran struck near Israel's nuclear research centre.
Crude oil prices tumbled nearly 15% on Monday on de-escalation talks before recovering nearly one-third of the intra-day losses.
ETF and COMEX inventory:
As of March 20, total known global gold ETF holdings stood at 98.59 MOz, as the outflows continued, taking the YTD outflow to 0.36 MOz.
It is to be noted that gold and silver ETF holders have been exiting their positions since the Iran war broke out.
Registered COMEX gold inventory fell to 16.51 MOz, lowest since November 6. The inventory is down by 31.91% since the record peak of 24.25 MOz seen in April 2025.
CFTC position:
Money managers increased their bullish gold bets by 3,684 net-long positions to 105,920 in the week ending March 17. Long-only positions rose 5,105 lots to 131,237, the highest in seven weeks, while short-only positions rose 1,421 lots to 25,317 lots, the highest in 16 weeks.
Dollar Index and yields:
The US Dollar Index eased with easing Middle East tensions.
At the time of writing this report, the Index was hovering around 99.20, down nearly 0.5% for the day.
Two-year US yields at 3.86% were down by over 1%, while ten-year yields at 4.36% were down by 1.5 bps.
Bonds have been under pressure as central bankers have turned cautious on the possibility of inflation spectre. Two-year yields closed at 3.89% on Friday -- highest since July and were up by almost 4% for the week. Similarly, 10-year yields at 4.39%, highest since August 18, were up by nearly 2.5% for the week.
Fedspeak:
Federal Reserve Bank of Chicago President Austan Goolsbee, a non-Voting member, said the US interest rate outlook depends on inflation. The Fed could need to raise interest rates or return to rate cuts depending on the war in the Middle East.
Upcoming data:
Major US data on tap this week include ADP weekly employment change, nonfarm productivity (4Q final), unit labour costs (4Q final), S&P global US manufacturing and services PMIs (March 24), Import and export price indices (March 25) and University of Michigan Sentiment and inflation expectations (March 27).
Investors will also monitor the Eurozone's and the UK's PMIs (March 24) and UK inflation (March 25).
Gold Price Outlook
:
After Trump’s five-day ceasefire proposal, rate hike probabilities in the US, UK and the Eurozone have come down. There has been a decline of nearly one rate hike by the year-end in the curves of the Euro-zone and the UK rates.
The Middle East situation has been diffused to an extent, but risks linger, especially since Iran has found energy infrastructure to be a crucial weak strategic point in the US’s armour.
Gold may trade range bound, albeit in a wide range, as traders will react to Iran headlines.
The expected range is $4200-4610 in the short-term. Should the risk appetite improve, bears may target the crucial level of $4090 once again. Traders may sell into rallies with stop-loss above $4840.
Poll Do you think traders should sell into gold price rallies currently? Yes, it's a good strategy No, they should hold
(Disclaimer: Recommendations and views on the stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India)