Gold extended losses on ⁠Thursday, after breaking below the key $4,000-per-ounce level for the first time in seven months a day earlier, as the dollar held strong ‌on rising expectations of Federal Reserve interest rate hikes this year.

Spot gold was down 0.7 per cent at $3,971.08 per ‌ounce, as of 0311 GMT. US gold futures for ‌August ⁠delivery lost 0.5 per cent to $3,987.

Bullion fell below the $4,000 level for ⁠the first time since November 2025 on Wednesday, and is down 29 per cent from a record high of $5,594.82 reached on January 29, weighed down by ​rising bets on US rate ‌hikes this year to tackle high inflation fuelled by the Iran war.

Traders expect three Fed rate hikes this year and are pricing in an about 67 per cent chance of ‌a September increase, according to the CME FedWatch Tool.

Bullion-backed ​exchange-traded funds could face renewed outflows if expectations rise for rate hikes, analysts say.

While gold ⁠is traditionally seen as an inflation hedge, it loses its appeal as a non-yielding asset in a high-interest-rate environment.

“Gold is simply ‌in a bearish momentum trade at this point amid a strong US dollar environment,” said Matt Simpson, a senior analyst at StoneX.

The dollar held firm near a 13-month high, making gold more expensive for buyers holding other currencies.

Investors now await the US Personal Consumption Expenditures data, the Fed’s ‌preferred inflation gauge, due later in the day, for further cues on ​monetary policy.

Investors also kept a close eye on the Middle East as Lebanon and Israel discussed ⁠a US-backed proposal for Israeli forces to transfer some of the ⁠Lebanese territory invaded in their war with Hezbollah to Lebanon’s military.

Spot silver fell 1.4 per cent to $56.61 per ‌ounce and platinum lost 1.1 per cent to $1,560.60, both hovering near their lowest levels since November 2025. Palladium inched 0.1 per cent lower to $1,165.63 ​and was near a nine-month low. 

Published on June 25, 2026