Inflation concerns reinforced hawkish bets on the Federal Reserve, causing gold to fall by more than 2%.

According to Mars Finance, on March 18th, gold prices fell to a one-month low, dropping below $4890 per ounce, a 2.36% decline on the day. Investors are weighing the risks of a more hawkish stance from the Federal Reserve, while high oil prices have exacerbated market concerns about inflation. Gold prices fell to their lowest level since February 18th. Jamie Dutta, a market analyst at Nemo.money, stated that investors are worried that high energy prices will lead to interest rates remaining high for a longer period. This is more likely to happen the longer the conflict with Iran continues. However, long-term drivers such as central bank gold purchases, stagflation risks, and diversification needs remain, meaning that gold prices will rise by the end of 2026.