Middle East Conflict Escalates; International Gold Prices Drop Again, Approaching $4,800 per Ounce

WealthCoffee · 2026-03-21T03:46:31+00:00

After the U.S.-Iran conflict erupted in late February 2026, international gold prices fell sharply, with cumulative declines exceeding 8% in March. Despite the escalation of hostilities, gold failed to recover its safe-haven asset logic and instead declined to $4,806 per ounce due to the Federal Reserve's interest rate decision and market expectations.

WealthCoffee

2026-03-21 03:46:31

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[Caixin] It is often said, “When cannons roar, gold flows,” but the unusual situation emerged with the outbreak of the US-Iran military conflict at the end of February 2026. Despite the ongoing and escalating conflict for over half a month, international gold prices did not rise but instead fell, with London spot gold prices declining by over 8% since March. A financial professional couldn’t help but be puzzled, asking, “When will gold regain its narrative as a safe-haven asset?”

On the evening of March 18, Beijing time, London spot gold experienced two significant drops. Around 9 p.m., influenced by attacks on major gas fields in Iran and Qatar and the sudden escalation of regional tensions, the gold price broke below the key psychological level of $4,900 per ounce. Subsequently, the Federal Reserve announced its latest interest rate decision, which was expected to keep rates unchanged, but Chairman Powell’s cautious tone at the press conference and hawkish signals further delayed market expectations of rate cuts. Under this pressure, gold prices continued to decline into the early hours of the next day, reaching a low of $4,806 per ounce.

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