Gold Prices Plummet Amid US-Iran Tensions Before Recovery

Gold prices plummeted to their lowest level of the year on July 24 as tensions between the US and Iran reached a boiling point, causing oil prices to surge and interest-rate hikes to become more likely.

The prolonged conflict drove up Brent futures prices, with crude reaching above $100 a barrel, and pushed Treasury yields to their highest in over a year and a half. This sent gold prices tumbling 29.65% from their annual high of 269,810 won on January 29, settling at 189,810 won.

However, as tensions between the US and Iran began to ease with Oman mediating talks between the two sides, oil prices started to decline. Brent futures fell to around $87 a barrel by July 27, causing gold prices to recover and even rise by 1.26% from the previous trading day to 192,210 won.

Market participants are now seeing this as a buy-the-dip opportunity due to stabilizing oil prices easing pressure on the gold market.