Gold Prices Rise as U.S.–Iran Tensions Boost Safe-Haven Demand
Gold prices moved higher on Friday, extending recent gains as escalating U.S.–Iran tensions increased safe-haven demand. Investors also reacted to fresh U.S. inflation and economic growth data.
At 08:50 ET (13:50 GMT), spot gold climbed 0.6% to $5,027.25 per ounce, while U.S. gold futures advanced 1% to $5,047.69 per ounce.
The precious metal has rallied strongly since mid-week, reversing earlier losses as geopolitical concerns resurfaced. Trading volumes remained relatively light, however, as Chinese markets were closed for the Lunar New Year holiday.
U.S.–Iran Tensions Support Gold Near Record Levels
Rising diplomatic tensions between Washington and Tehran have underpinned gold prices in recent sessions.
U.S. President Donald Trump warned that Iran must negotiate a nuclear agreement within the next 10 to 15 days or face consequences, highlighting the risk of potential military action. Any escalation could disrupt Middle East oil flows and unsettle global financial markets.
According to analysts at ING, markets remain highly sensitive to developments in U.S.–Iran talks. Ongoing uncertainty has helped keep gold supported near record highs.
The broader outlook for gold remains constructive. Geopolitical risks, expectations of lower interest rates later this year, and steady investor and central bank demand continue to provide support. While volatility may increase around geopolitical headlines, the overall risk bias for gold remains tilted to the upside, even if gains become more gradual.
Strong Dollar and Fed Signals Cap Further Gains
Despite geopolitical support, gold’s upside was limited by a stronger U.S. dollar and hawkish signals from the latest Federal Reserve meeting minutes.
The U.S. Dollar Index was on track for a weekly gain of more than 1%, marking its strongest performance in months. A firmer dollar typically pressures non-yielding assets such as gold.
Inflation data also influenced sentiment. The core Personal Consumption Expenditures (PCE) price index — the Federal Reserve’s preferred inflation gauge — came in above expectations in the final month of 2025.
Core PCE rose 0.4% month-on-month in December and increased 3.0% year-on-year. The annual reading was the highest since November 2023 and remained well above the Fed’s 2% target.
Meanwhile, preliminary data showed that U.S. fourth-quarter GDP expanded by 1.4%, significantly below the expected 2.8% growth rate. The weaker economic growth figure added another layer of complexity to the market outlook.
Other Precious Metals Extend Gains
Broader metal markets also posted gains.
Silver surged 3.8% to $80.63 per ounce, while platinum advanced 2.7% to $2,124.90 per ounce.
In industrial metals, London Metal Exchange copper futures slipped 0.1% to $12,807.93 per ton. U.S. copper futures edged up 0.1% to $5.7455 per pound.
