Rising again! Gold prices return to $4,600, Wall Street: Pullback is a buying opportunity

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Gold prices are back above $4,600.

On March 25, during intraday trading, the London spot gold price briefly rose above $4,600 per ounce. As of the time of publication, the London spot gold price was $4,564.84 per ounce, up 2.08% on the day; COMEX gold was $4,555.7 per ounce, up 3.49% on the day.

Affected by this, some domestic jewelry brands have also raised their gold jewelry prices, with the price per gram returning to 1,400 yuan. On March 25, Chow Sang Sang’s pure gold jewelry was quoted at 1,418 yuan per gram, up 68 yuan for the day; Lao Feng Xiang quoted 1,408 yuan per gram, up 63 yuan per gram for the day.

In China’s A-share market, gold-related stocks also saw a broad surge. Chifeng Gold, Xiaocheng Technology, Xingye Silver & Tin, China Gold, and others all rose sharply.

On the news front, according to CCTV News, local time on March 24, the U.S. government submitted to Iran via Pakistan a ceasefire-ending plan containing 15 conditions. It covers the nuclear program, missile capabilities, and regional issues, while also ensuring that the Strait of Hormuz remains open. As a swap condition, Iran could receive comprehensive lifting of international sanctions, U.S. support for its development of civilian nuclear projects, and the cancellation of a “snapback sanctions” mechanism. The U.S. side is considering pushing for a one-month ceasefire so that further negotiations can be carried out on the above terms.

Why did gold’s “safe-haven” role “fail”?

Since the outbreak of the U.S.-Iran war, gold prices have not risen but fallen. This Monday, the spot gold price briefly dipped below $4,100 per ounce, down more than 20% from the $5,608 all-time high set in January, and it once fell to around $4,098. This has been seen as entering a technical bear market.

This trend has left many investors perplexed: as a traditional safe-haven asset, why is gold continuing to drop precisely as geopolitical risks are surging sharply?

Market views hold that gold’s safe-haven characteristics have not truly failed; they are simply being suppressed in the short term by stronger macro variables.

UBS Global Wealth Management’s team attributes gold’s recent decline to factors such as investors’ confidence in Fed rate cuts weakening and a drop in market speculative momentum. Currently, the market is focusing more on the chain of “oil prices rising—inflation lifting—Fed maintaining tight policy” rather than the path of “oil price shock—economic slowdown—policy shift.” This single narrative has significantly weakened gold’s macro-hedging attributes in the short term.

UBS analyst Wayne Gordon said that for many investors, gold has appeared relatively dull in the face of heightened geopolitical tensions and increased price volatility, which seems to run counter to people’s intuition. However, history shows that especially in the early stages of a conflict, gold does not always go up. A clear conclusion is that gold’s price trend is often not driven directly by the conflict itself, but instead determined by policy and economic backdrop. As the market is adjusting to higher expected interest rates and a stronger U.S. dollar, gold’s value-preservation role in the early part of the cycle has come under pressure. But this is not a failure of gold’s safe-haven performance—it is a delay.

Citi’s report points out that over the past 12 months, momentum-driven buying led by retail and ETF investors has been the core driving force behind gold’s continued rise since $2,500 per ounce. Meanwhile, central banks’ purchases of gold have remained basically stable over the past two to three years. This holding structure, dominated by retail and retail-momentum funds, makes it extremely easy for gold to be forced into tracking lower when risk assets face large-scale selloffs.

Citi further noted that rising real interest rates and a stronger dollar have also weighed on gold prices. Combined with the passive trimming by large numbers of retail and ETF holders, gold’s “pro-cyclical” linkage with other risk assets has become more extreme than its historical average.

Peter Schiff, a well-known Wall Street economist and CEO of Europacific Capital, believes that gold’s current selloff is reenacting the script of the “2008 global financial crisis.” He criticized the logic behind this selloff, arguing that traders made a fundamental mistake: they sold gold out of concern that persistent inflation would prevent the Fed from cutting rates.

“Given that interest rates are already so low, there is simply no reason to sell gold because rising inflation would stop the Fed from cutting rates. Falling real interest rates are good for gold—but what truly needs rate cuts is the stock market.” Schiff predicted that once high interest rates push the economy into a recession, the Fed will change course—cut rates and restore quantitative easing policies. This move would be a strong positive for gold.

The market is uneasy about whether a ceasefire or a peace agreement would erode gold’s geopolitical premium. Schiff firmly rebutted that. He pointed out that if the war ends quickly, that would be negative for gold, but it would not be enough to offset all the positive factors. In addition, the government still needs to pay for additional weapons and the costs of rebuilding destroyed areas. Therefore, compared with a situation in which no war ever occurred, the fiscal deficit and inflation would be larger.

Institutions remain bullish

Despite near-term pressure, most institutions still hold optimistic views on gold’s medium- to long-term outlook.

UBS analyst Giovanni Staunovo said that in recent years, the structural drivers that pushed gold higher—such as debt-related issues, political pressure to demand Fed rate cuts, high inflation, low interest rates, and a weaker dollar—still exist with no change.

In Gordon’s view, if history can serve as a reference, it may be too early to be broadly negative on gold’s future prospects. “Because the market is adjusting to higher expected interest rates and a strong dollar (both are short-term headwinds for gold prices), gold’s value-preservation role in the early part of the cycle has been under pressure. But this is not a failure of gold’s safe-haven performance; it is a delay.”

Standard Chartered Bank’s senior investment strategist Rajat Bhattacharya also said the firm remains constructively positioned on gold over the long term, supported by structural factors including strong demand from central banks in emerging markets and investors’ need to diversify their allocations amid geopolitical risk. He also emphasized that a softer dollar should again support gold prices, and that market expectations for the Fed’s eventual rate cuts are the important catalyst driving the dollar weaker.

Citi said that gold’s “buying timing depends on the path, not the price level.” If the Iran conflict ends within the next four to six weeks, investors should wait until risk assets stabilize overall and the stock market bottoms before stepping in. If the conflict lasts longer, then when real yields start to decline or gold prices show a technical momentum reversal, that would be a more reliable buy signal. Over a longer cycle, the “frictions” that push gold prices higher over the long run always exist—concerns about sovereign debt risk, worries that the credibility of the dollar will be passively diluted, Chinese residents’ savings continuing to allocate to gold, and diversified reserve demand from central banks in emerging markets—all of which form persistent forces supporting prices.

BMO maintains a long-term bullish stance on gold. The bank’s commodities analyst said that the Iran conflict has not weakened the structural bull-market logic for metals and the mining sector; instead, it further reinforces this logic. The current issue is simply when the market can regain enough confidence—confidence that the conflict has moved toward resolution—so that risk exposure can be increased again. BMO expects that the average gold price in the third quarter of 2026 will reach $4,800 per ounce, rising to $4,900 per ounce in the fourth quarter, with an average price for the full year of $4,846 per ounce. Looking even longer term, BMO expects 2027 gold prices to remain stable above $5,000 per ounce, with a full-year average price potentially reaching $5,125 per ounce—an increase of 26% from its prior forecast.

Global X ETFs investment strategist Justin Lin said that the current selloff is jointly driven by short-term sensitivity to interest rates, portfolio rebalancing triggered by a decline in the stock market, and also a degree of complacency in the market about the Iran conflict. He characterizes this decline as an “attractive buying opportunity for investors” and maintains its benchmark forecast of $6,000 per ounce at year-end.

Standard Chartered expects that within three months after this deleveraging cycle ends, gold prices could rebound to $5,375. BofA Securities forecasts that the average gold price in Q2 to Q4 2026 will rise quarter by quarter, located in the $4,500 to $5,750 range, with a target price at year-end of $5,750 per ounce. For Q1 2027, the average is expected to be around $5,200.

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责任编辑：朱赫楠