FX.co ★ Gold Drops on US Blockade of Hormuz

Gold fell nearly 2% on Monday to below $4,700 an ounce, erasing last week’s gains, as US plans to blockade the Strait of Hormuz following failed weekend talks with Iran intensified fears of a deepening global energy crisis. The measures, set to begin at 10 a.m. Eastern Time, will apply exclusively to vessels entering or leaving Iranian ports. Negotiations held in Pakistan ended without a deal, with Washington accusing Tehran of refusing to rein in its nuclear program, while Iran reportedly demanded control over the strait, war reparations, a regional ceasefire, and access to its frozen overseas assets. The effective shutdown of this key maritime corridor has sent energy prices sharply higher and heightened inflation concerns, bolstering expectations that central banks may postpone rate cuts or even resume tightening. These developments have pressured gold, leaving it more than 10% lower since the conflict erupted.