Gold fell nearly 1% to around $4,450 on Monday, trimming gains from the previous session as the conflict in the Middle East entered its fifth week with no clear path to resolution. Tensions in the region escalated after Iran‑backed Houthi militants in Yemen joined the fighting, launching attacks against Israel over the weekend. The group also poses a threat to vessels transiting the Red Sea and to key Saudi Arabian energy infrastructure.
At the same time, the US military is reportedly preparing for weeks of ground operations in Iran following the arrival of additional troops in the region. Gold remains more than 15% below its March peak, as the oil price shock has heightened inflation concerns and strengthened expectations of interest rate hikes by major central banks. A shift in central bank behavior — from net buyers to a more cautious stance — has also weighed on prices, as major economies increase liquidity to offset the economic fallout from the Iran war.
