Gold prices edged higher on Tuesday, with the precious metal trading around $5,020 per ounce, even as it remained close to its lowest level in nearly a month, reflecting cautious market sentiment amid escalating geopolitical tensions and uncertainty over global monetary policy.
Latest market data shows gold rising to $5,028.47 per troy ounce on March 17, 2026, representing a 0.43% daily gain. Despite the modest uptick, the metal has increased by just over 1% in the past month, although it remains significantly higher on a year-on-year basis, up nearly 66%, underscoring its continued appeal as a long-term hedge.
The price movement comes as investors weigh the economic implications of the ongoing conflict involving the United States, Israel, and Iran, now in its third week. Iran has intensified strikes on energy infrastructure across the region, while Donald Trump has warned that Iran’s oil facilities on Kharg Island could be directly targeted if tensions escalate further.
The conflict has kept global energy prices elevated, reinforcing concerns about persistent inflationary pressures. Higher oil and energy costs tend to filter through supply chains, raising transportation and production expenses, which can sustain or even accelerate inflation in major economies.
This backdrop has complicated the outlook for central banks. While gold typically benefits from geopolitical uncertainty, its gains have been tempered by expectations that monetary authorities may maintain a hawkish stance for longer. Investors are closely watching the Federal Reserve, which is widely expected to hold interest rates steady at its upcoming meeting. Other major central banks, including the European Central Bank, Bank of England, and Bank of Japan, are also anticipated to keep policy settings unchanged.
Higher interest rates generally reduce the appeal of gold, as the metal does not yield interest, making it less attractive relative to interest-bearing assets such as bonds. This dynamic has helped keep gold prices from rallying more strongly despite heightened geopolitical risks.
Meanwhile, efforts to stabilise global energy markets remain uncertain. President Trump has renewed calls for an international coalition to secure shipping routes through the Strait of Hormuz, a critical artery for global oil and commodity flows. However, some countries have reportedly declined to participate, adding to market uncertainty over how quickly supply disruptions can be resolved.
For now, gold appears to be caught between competing forces: on one hand, geopolitical risk and inflation concerns that typically drive safe-haven demand, and on the other, the prospect of prolonged tight monetary policy, which limits upside momentum.
Market analysts say the near-term direction of gold will likely depend on how these dynamics evolve, particularly whether energy prices continue to rise and whether central banks signal any shift in policy stance in response to the unfolding global situation.
