Gold drops to $4,078 on U.S Fed tightening fears

June 24, 2026 (MLN): Gold extended its decline on Wednesday, slipping as a stronger dollar and rising expectations of U.S. interest rate hikes pressured the metal, while conflicting statements from Washington and Tehran cast fresh doubt over the durability of their nuclear agreement.

Currently, spot gold is down 2.54% to $4,078.23 an ounce as of [12:42 pm] PST, according to data reported by Mettis Global.

The geopolitical backdrop offered little comfort to buyers.

U.S. President Donald Trump claimed Iran had agreed to nuclear inspections in perpetuity, a characterization Tehran promptly rejected, saying no such concession had been made.

The two sides also remained at odds over terms governing Iranian access to frozen overseas assets, deepening uncertainty around a deal already regarded as fragile, according to CNBC.

The selloff in gold has been driven largely by a shift in the inflation narrative  rather than stoking safe-haven demand, mounting price pressures have fuelled expectations of aggressive Federal Reserve tightening, which dulls the appeal of non-yielding assets like gold.

The dollar climbed to its highest level in more than a year, compounding the pressure by making gold costlier for international buyers.

Markets are now pricing in three Fed rate hikes for 2026, a sharp revision from bets of just one increase before last week's policy meeting, according to the CME FedWatch Tool.

Attention now turns to Thursday's U.S. Personal Consumption Expenditures reading the Fed's preferred inflation gauge  for the next steer on the rate path.

Other precious metals also declined. Spot silver dropped 0.9% to $61.44 per ounce, platinum fell 0.8% to $1,638, and palladium lost 0.8% to $1,227.41.

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