Gold prices opened the week lower as markets weighed the inflationary consequences of climbing oil against longer-term drivers supporting precious metals, with the U.S.-Iran diplomatic standoff adding a layer of geopolitical uncertainty to the commodity outlook.
Spot gold traded 0.2% lower at $4,530.87 per troy ounce in Asian morning hours, while New York futures fell 1.2% to $4,536.90. The U.S. dollar index rose 0.1% to 98.97, adding pressure on dollar-denominated commodities.
The move came after the U.S. and Iran exchanged fresh military strikes over the weekend, according to the Wall Street Journal. Negotiations between the two sides have stalled over the reopening of the Strait of Hormuz and the terms of Iran’s nuclear program. In a post on Truth Social, President Trump said the proposed deal states clearly that Tehran will not have a nuclear weapon, while Iranian negotiators have pressed for relief from sanctions and asset freezes.
Guoxin Futures analysts said in a note that the major disagreements between Washington and Tehran remain unresolved, with military frictions near the strait stoking geopolitical risk premiums in markets. The dollar and Treasury yields continued to fluctuate at elevated levels, leaving precious metals without a clear directional catalyst, according to the analysts.
“The price action highlights the market’s ongoing struggle to balance the inflationary implications of elevated energy prices — which tend to support the dollar and bond yields — against longer-term bullish drivers such as de-dollarization, fiscal debt concerns, and persistent central bank demand,” analysts at Saxo Bank said.
Oil’s 3%+ surge on the day amplified concerns that sustained energy-price elevated levels could force the Federal Reserve to maintain higher interest rates for longer, a scenario that typically weighs on non-yielding assets such as gold. But the same geopolitical uncertainty that pushed oil higher also supports demand for gold as a traditional haven asset, creating a cross-current for the precious metal.
Copper and aluminum
Goldman Sachs raised its year-end copper price forecast to $13,735 per metric ton from a prior estimate of $12,465, according to a note cited by the Wall Street Journal. The bank cut its 2026 global mine supply outlook by 350,000 tons after disruptions at the Grasberg mine in Indonesia and the Kamoa-Kakula mine in the Democratic Republic of Congo, neither of which is expected to return to full capacity until 2028.
Stronger-than-expected U.S. copper imports prompted Goldman to sharply increase its projected copper deficit outside the U.S. market to 640,000 tons for 2026, up from a prior estimate of 60,000 tons. The bank expects the market to remain supported by structural demand from electrification and energy-transition projects, though U.S. tariff policy remains a key risk to prices, according to the report.
In early trading, three-month London Metal Exchange copper futures rose 0.7% to $13,714 per metric ton.
Meanwhile, Jefferies analyst Chris LaFemina said aluminum reaching $4,000 per metric ton in the near term does not seem unreasonable given disruptions to Middle East supply. LME aluminum traded at $3,678 per metric ton.
“I think one of the potentially offsetting arguments to the bulls would be: what happens if China ramps up domestic smelting?” LaFemina said, noting that China has in recent years maintained a 45-million-ton production cap.
LaFemina, who said he sits in the bull camp on aluminum, flagged the potential for a Chinese policy shift as an underappreciated risk. “It’s notable to me that the risk around a capacity overhang in China ultimately being unleashed via policy shift is something people don’t seem to be really considering,” he said. “And I do think that’s something they really need to at least think about.”
What comes next
Investors are watching developments in U.S.-Iran negotiations and upcoming U.S. jobs data for further signals on the interest-rate outlook and broader market sentiment, according to the Wall Street Journal.