Gold slips below $4,000 as Middle East conflict stokes inflation, rate-hike fears

Gold remained under pressure around the $4,000-an-ounce level after briefly regaining that threshold on Monday, as the Middle East conflict kept oil prices elevated and reinforced concerns that persistent inflation could prompt further Federal Reserve tightening. The metal had posted a 2.5% weekly loss and briefly fell below $4,000 after first breaking above that level in late June for the first time since November 2025. Brent crude climbed past $90 a barrel after the United States carried out a ninth consecutive night of strikes against Iran, while two American personnel died in Jordan and allies reported fresh Iranian attacks on Sunday. Cleveland Fed President Beth Hammack joined a growing chorus of officials arguing that interest rates may need to rise again, while Kevin Warsh told the House Financial Services Committee the Fed has “no tolerance for persistently elevated inflation.” CFTC data showed COMEX gold speculators raised net long positions to 119,147 contracts in the week ended July 14, suggesting traders still see room for gains. Even so, gold’s traditional war-hedge role has been uneven because the same oil surge that can boost safe-haven demand is also lifting rate-hike expectations, increasing pressure on non-yielding bullion. Whether gold falls below $4,000 again may hinge on this week’s Fed commentary and oil prices.