TLDR
- Yellow metal climbed on defensive buying following fresh Israeli military action in Tehran, though a resilient dollar limited upside momentum
- Bullion prices fluctuated between $5,121 and $5,156 per ounce Thursday, marking nearly 20% gains since January
- The precious metal reached an all-time peak of $5,594.82 in January 2026, surging past $5,400 as U.S.-Israeli military operations against Iran intensified
- The central bank’s upcoming monetary policy announcement scheduled for March 18 is widely anticipated to maintain current interest rate levels
- Former Federal Reserve board member Kevin Warsh received formal nomination from President Trump for Fed chairman position Wednesday
The yellow metal experienced bidirectional movement Thursday as conflicting market dynamics created push-pull pressure: escalating Middle Eastern hostilities encouraging defensive asset allocation, while greenback strength increased the metal’s cost for international purchasers.
Bullion traded within a range of approximately $5,121 to $5,156 per ounce throughout Thursday’s session. Earlier during trading hours, prices briefly exceeded $5,200 before retreating.
The precious metal has appreciated almost 20% during 2026 thus far. It established an unprecedented peak of $5,594.82 in January.
As military operations involving U.S. and Israeli forces against Iran commenced earlier this week, bullion surged beyond $5,400 on Monday. This upward movement reflected investor flight-to-quality as regional tensions intensified.
Israel executed another substantial round of military operations targeting Tehran on Thursday. Officials stated the strikes focused on facilities linked to Iranian government entities.
The offensive followed Iranian missile launches that forced millions of Israeli civilians into protective shelters.
Safe-Haven Demand vs. Dollar Strength
The U.S. dollar appreciated roughly 0.2% Thursday, temporarily retreating from three-month peaks. Greenback strength typically constrains gold advances since it elevates the metal’s price in alternative currencies.
Hamad Hussain, climate and commodities economist at Capital Economics, noted the Middle East situation generates contradictory pressures for the precious metal. Defensive demand elevates prices, though elevated energy costs may intensify inflation and diminish rate reduction prospects — potentially pressuring gold downward.
Gold generates no yield, making it more attractive during low-rate environments.
Fed Policy in Focus
President Trump formally announced former Federal Reserve Governor Kevin Warsh as his selection for the next Fed chairman position Wednesday.
The central bank published its latest Beige Book Wednesday, indicating modest U.S. economic expansion, continued price increases, and stable employment conditions.
Market participants currently anticipate the Fed will maintain existing rates at its March 18 policy meeting, based on CME Group’s FedWatch tool projections.
Traders are monitoring Thursday’s weekly jobless claims figures and Friday’s February employment report. Both datasets could provide additional insight regarding future rate trajectory.
Worries about climbing energy costs are intensifying inflation anxieties throughout worldwide markets.
Silver advanced 0.8% to $84.10 per ounce Thursday. Platinum climbed nearly 1% to $2,168.05, whereas palladium declined 0.9% to $1,659.35.
