Gold prices rose on Tuesday amid hopes of easing tensions in the Middle East. Spot gold climbed 1.5% to about $4,579 per ounce, while US April futures gained 1.2% to around $4,611. Silver, platinum, and palladium also posted gains. A slightly softer dollar made the metal cheaper for buyers using other currencies.
However, gold is heading for its worst month in more than 17 years. It has fallen by over 13% in March 2026, the biggest monthly drop since October 2008. This sharp decline comes despite earlier gains this year. The metal is still up about 5% for the quarter.
The main reasons are a stronger US dollar and fading hopes for Federal Reserve interest rate cuts. Rising energy prices from the Middle East conflict have pushed up inflation fears. Higher oil costs make it less likely that the Fed will lower rates this year. Gold does not pay interest, so higher rates make it less attractive to investors.
Traders now expect no rate cuts in 2026. Fed Chair Jerome Powell said the central bank can “wait and see” how the situation affects inflation. A strong dollar also hurts gold because it becomes more expensive for foreign buyers.
Analysts say the drop reflects short-term market forces. Geopolitical risks usually support gold as a haven, but inflation worries and a firm dollar have outweighed that benefit this time.
Some experts believe gold could recover later if rates ease or tensions fully calm. For now, March has been tough for bullion holders.
