Even though geopolitical tensions can sometimes provide temporary support to gold prices, today’s markets show that these factors are no longer sufficient to reverse a fundamental downward trend dominated by macroeconomic forces.
Gold prices have recently fallen sharply, dropping more than 8% on the COMEX, reaching levels not seen since last November. This weakness occurs despite geopolitical conflicts, including in major producing and consuming regions that in the past tended to increase gold’s appeal as a safe haven.
Economists point out that a strong U.S. dollar, rising real interest rates, and higher energy prices are the main factors weighing on the precious metal. In this environment, investors are more attracted to liquid assets with immediate returns, relegating gold to a secondary position.
Recent data also shows a slowdown in gold purchases by central banks, even though overall demand remains. Some countries continue to expand their reserves, indicating that structural interest in gold persists.
In the short term, the trend remains bearish, but long-term prospects could improve if stagflation (low growth + high inflation) emerges a scenario where gold often regains its role as an inflation hedge.
