Gold Climbs Toward $4,100 as US-Iran Pause Eases Inflation Fears, Pulls Metal From 9-Month Low This Week

Gold prices climbed roughly 1% Monday, moving away from nine-month lows as a weekend pause in hostilities between the United States and Iran sent oil prices sharply lower, easing inflation concerns that had weighed heavily on the precious metal in recent weeks.

A modest but meaningful rebound

Gold futures rose to $4,092.40 an ounce, up $21.60, or 0.53%, according to trading data Monday, with the spot price climbing toward the $4,100 mark during the session. The gain builds on a broader recovery that has taken hold since Friday, when gold traded closer to $4,030 an ounce, and reflects a notable shift in sentiment following the de-escalation between Washington and Tehran over the weekend.

A pause in fighting drives the rally

The catalyst behind Monday’s advance was a decision by the United States to suspend its nearly two-week campaign of strikes against Iran, a shift that began late Friday without an official public announcement. Iran, for its part, said it had ended its own retaliatory strikes in response and entered discussions with Oman regarding safe navigation through the Strait of Hormuz, one of the world’s most critical energy shipping corridors. That mutual de-escalation triggered a sharp decline in oil prices, with Brent crude falling roughly 6% to trade around $90 a barrel, easing fears of prolonged supply disruptions that had been building since fighting between the two countries intensified earlier this year.

For gold, the retreat in oil prices carried significant implications. Lower energy costs typically ease broader inflation pressures, which in turn reduces the perceived need for further interest rate increases from central banks, a dynamic that tends to support demand for non-yielding assets like gold. With some of that inflationary pressure now easing, at least temporarily, investors moved back into the precious metal Monday after weeks of comparatively weaker demand.

A difficult recent stretch for the metal

Gold’s rebound follows a rough patch over the preceding two weeks. Prices fell toward $4,030 an ounce Friday, extending a nearly 2% decline from the previous session, as surging oil prices tied to the escalating Middle East conflict strengthened the case for tighter monetary policy in the United States. President Donald Trump had warned of expanded military action against Iran during that stretch and vowed to hold Tehran accountable for any future attacks by Houthi forces on commercial vessels in the Red Sea, comments that helped push Brent crude above $100 a barrel for the first time since May and stoked broader inflation fears across financial markets.

Those elevated oil prices, and the resulting expectations for tighter Federal Reserve policy, weighed on gold throughout the period, pulling prices down to levels not seen in roughly nine months even as the metal remains up more than 23% compared to the same point last year.

Central bank policy also in focus

Beyond the Middle East conflict, monetary policy decisions have continued to shape gold’s trajectory in recent sessions. The European Central Bank kept interest rates unchanged the previous Thursday, while leaving the door open to a potential rate increase in September, a stance that added another layer of complexity to the broader global rate outlook investors have been weighing alongside developments in the Iran conflict.

Diverging demand trends across Asia

Physical demand for gold has shown notable regional divergence in recent weeks. In India, gold discounts widened to a seven-week high as elevated prices curbed retail buying interest, according to trading data, reflecting how price-sensitive consumer demand in one of the world’s largest gold markets has cooled somewhat as prices have remained elevated. In China, by contrast, buying interest reportedly improved over the same period, suggesting demand patterns across the two major Asian gold markets have moved in somewhat opposite directions even as the global price backdrop has remained broadly similar for both.

A mixed picture in local Indian gold markets

Domestic gold prices in India also reflected the broader recovery Monday. In Delhi, the 24-karat gold rate rose 96 rupees per gram to 14,604 rupees, extending gains after gold held steady the previous day and advanced the day before that. Despite the recovery, prices in Delhi remained about 52 rupees below the recent high of 14,656 rupees per gram reached on July 22, following a sharp pullback that saw gold slip 23 rupees on July 23 before falling another 185 rupees the following day. A similar pattern played out in Kolkata, where 24-karat gold rose 96 rupees to 14,589 rupees per gram, extending a recovery from a sharper correction seen the previous week. On India’s Multi Commodity Exchange, futures prices for 24-karat gold rose 0.56% to reach 143,904 rupees per 10 grams as trading resumed Monday following a two-day market closure.

A year defined by extraordinary gains

Monday’s advance adds to what has already been an extraordinary year for gold. The metal set a fresh all-time high near $4,736 an ounce in January, extending a rally that gained momentum in the final quarter of 2025 and carried into the new year. That record marked a gain of more than 70% from gold’s 52-week low near $2,703, and stands in stark contrast to the metal’s all-time low of roughly $866, recorded back in April 2009, underscoring the scale of gold’s cumulative rise over the past decade and a half.

With the pause in U.S.-Iran hostilities still fragile and markets watching closely for signs of whether it holds or gives way to renewed fighting, gold traders are likely to remain highly sensitive to any fresh developments out of the Middle East in the days ahead. At the same time, upcoming signals from the Federal Reserve and other major central banks regarding the future path of interest rates are expected to continue shaping demand for the metal, particularly given how closely gold’s recent swings have tracked shifts in both geopolitical risk and the broader inflation outlook throughout this volatile stretch of 2026.