Gold is nursing a split personality. Futures on the Comex settled at $4,510.50 per ounce, while spot prices closed at $4,522.60 — a range that neatly captures a week of unrelenting pressure. From their January peak, the precious metal has now shed roughly 17%, and three distinct forces are to blame.
The most immediate blow came from New Delhi. India, one of the world’s largest gold consumers, hiked its import duty from 6% to 15% — a move that the World Gold Council expects will slash demand by 50 to 60 tonnes in 2026, equivalent to around 10% of the Indian market. Bars and coins, sensitive to higher costs, are expected to bear the brunt. The impact was felt instantly in Delhi, where gold prices dropped 600 rupees to 1.64 lakh per 10 grams.
That tariff shock landed in a market already grappling with a hawkish pivot at the Federal Reserve. On May 22, Kevin Warsh succeeded Jerome Powell as Fed chair and immediately signaled a tighter stance: balance-sheet reduction and closer coordination with the administration. Markets have priced in a 58% probability of a 25-basis-point rate hike before December, a scenario that undermines gold’s appeal as a non-yielding asset. Fed governor Christopher Waller reinforced the message by reiterating his opposition to premature easing. US inflation remains stuck at 3.8%, and long-term inflation expectations have crept up to 3.9%, giving the central bank little reason to loosen.
Compounding the headwinds, geopolitical tensions that had fueled safe-haven buying have eased. Reports of progress in US-Iran negotiations have deflated the risk premium that earlier this year pushed investors toward bullion. As fears receded, long positions in gold were pared back, draining a key source of demand.
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On the supply side, several miners are moving ahead. 1911 Gold Corp is advancing its True North Mine in Manitoba, with test mining slated for 2026, while NevGold is accelerating development of the Limo Butte project in Nevada, which also holds antimony resources.
Chart watchers note that gold is now trading about 3% below its 50-day moving average of $4,670. The $4,500 level has become a psychologically important support — one that is being tested by the simultaneous pull of three negative catalysts.
Looking ahead, market direction hinges on whether Warsh fleshes out his balance-sheet plans in the coming days. Any concrete steps toward tightening would add fresh pressure. Conversely, if the Iran talks hit a snag, the risk premium could snap back, rekindling haven demand. For now, the combination of tighter monetary policy, fading geopolitical anxiety, and weaker physical buying from India has given gold little room to breathe — and few reasons to rally.
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