Reasons why gold prices did not rise but fell after the US-Iran conflict

After the U.S. and Israel attacked Iran, gold prices continued to be weak. Previously, gold, which had been regarded as a “safe-haven asset,” would be bought as geopolitical risks rose. Analysts say that, in addition to the headwind from a stronger U.S. dollar and higher interest rates, the rapid increase in volatility in the financial markets was also one of the reasons investors sold gold to make up for losses, leading to the weak prices.

As the New York futures contract (front-month) that serves as an international benchmark for gold, March 11 was around $5,170 per ounce, down more than 1% from before the U.S.-Iran conflict. Although prices rose on March 2 after the outbreak of the conflict, they fell sharply on March 3 and have since failed to recover to the pre-conflict level. Gold’s trend has been similar to that of the Dow Jones Industrial Average, and it has not become a haven for funds in an emergency.

When Russia launched its invasion of Ukraine in February 2022, gold rose by 4% on the 8th business day after the start of the attack.

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The Japanese Economic News Agency and the Financial Times merged into the same media group in November 2015. The alliance formed by two newspapers in Japan and the U.K. that were founded in the 19th century as well is moving forward with collaboration across a wide range of areas, under the banner of “high-quality, the most powerful economic journalism.” This time, as part of that effort, the Chinese websites of the two newspapers have enabled article exchanges.