Gold prices dropped to $3,120 per ounce following fresh Iranian attacks that triggered sharp rallies in TTF gas and crude oil markets, according to Commerzbank commodity analyst Carsten Fritsch. Despite the initial selloff, downside potential appears limited as China’s central bank continues its aggressive gold accumulation strategy. The People’s Bank of China has maintained steady purchases, providing firm support beneath current price levels. Federal Reserve rate expectations have remained stable throughout the geopolitical turbulence, suggesting the gold pullback reflects tactical repositioning rather than fundamental reassessment. The Iranian strikes created a flight-to-energy dynamic that temporarily diverted safe-haven flows away from precious metals, but Commerzbank analysts expect this pattern to reverse as markets digest the geopolitical shock. With the PBoC underpinning demand and Fed policy trajectory unchanged, gold’s correction may prove short-lived.
FXnCO Insight
Traders should view gold dips toward $3,120 as potential buying opportunities given ongoing central bank demand and stable monetary policy expectations supporting medium-term bullish positioning.
Source: FXStreet