【TMGM Financial Recap】Gold Prices Hit A One-Week Low, US-Iran Conflict Pushes Up Oil Prices And Interest Rate Hike Expectations, Gold Bulls Suffer Multiple Blows!
On Thursday, global financial markets experienced intense turmoil, with gold prices falling sharply and spot gold dropping nearly 2% at one point. Meanwhile, crude oil prices surged above the $100 mark, US Treasury yields surged, and the US dollar index recovered losses. On the surface, geopolitical conflicts should support safe-haven assets, but gold bucked the trend and weakened, driven by a triple blow from soaring oil prices, renewed inflationary pressures, and rising expectations of Fed rate hikes.
On Thursday, Yemen's Houthi forces seized Mocha, a key port on the Red Sea coast, and advanced south along the coastline to near the Hanish Islands, further approaching the strategic Bab el-Mandeb Strait. This development echoes the tense situation in the Strait of Hormuz. Military reports indicate that the Houthis' operations are directly directed by Iran's Revolutionary Guard, whose influence has extended to key waterways at the southern tip of the Red Sea. The UN Special Envoy for Yemen warned that the conflict has entered a new and more dangerous phase, posing a serious threat to global shipping freedom.
As the world's largest oil exporter, Saudi Arabia has heavily relied on Red Sea shipping lanes for crude oil exports since the de facto blockade of the Strait of Hormuz. The Houthis have previously announced a maritime blockade against Saudi Arabia and escalated their attacks. If it further controls the Mandeb Strait, Iran and its allies will gain a key strategic advantage in their confrontation with the United States, significantly reducing the supply capacity of alternative shipping routes. The market responded quickly, with crude oil breaking through the $100 mark, marking the largest single-day gain in nearly two months. The threat is no longer confined to a single shipping chokepoint but may spread to regional export routes, production facilities, and broader energy infrastructure.
The surge in oil prices directly boosted global inflation expectations. The U.S. August Producer Price Index showed energy prices surged 4.2% month-on-month, ending two consecutive months of decline; Diesel prices surged 24.1%, contributing more than one-third of the increase in commodity costs. Producer commodity prices rose 1.1% overall. This energy-driven inflationary pressure quickly transmitted to financial markets repricing monetary policy, becoming one of the core factors suppressing gold.
Meanwhile, the U.S. Treasury market reacted sharply. The 10-year Treasury yield once rose more than 10 basis points to around 4.92%-4.95%, the highest since the end of 2023; The 30-year yield hit near its highest level since 2007. The rise in U.S. Treasury yields means the opportunity cost of holding gold has increased, directly weighing on gold prices. The U.S. dollar index strengthened in tandem, recovering some of its losses earlier this week to close around 99, further increasing the cost of dollar-denominated gold to non-U.S. buyers.
Market Insight:
Considering the current situation, gold faces obvious short-term pressure. If Friday's August CPI data remains hot, rate hike expectations may further strengthen, and gold prices may test lower support levels. If oil prices remain high due to geopolitical conflicts, inflationary stickiness will continue to limit gold's room for a rebound.
