Gold falls 9.6% as Iran war drives oil up, yields rise
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- Gold futures lost $486.80 per ounce (9.6%) last week, settling at $4,574.90, marking their worst weekly drop in 14 years.
- Brent futures rose 1.31% to around $112 a barrel, driven by Iran’s control of the Strait of Hormuz.
- S&P 500 fell 1.62% on the day and over 5% since the war began, but has not yet reached its historical pain threshold.
- U.S. 10‑year Treasury yield climbed to about 4.55%, reflecting concerns about inflation and potential Fed rate hikes.
- Bitcoin rose roughly 0.6% while risk assets fell, highlighting divergent market behavior.
- Jurrien Timmer (Fidelity) asked why yields and bitcoin are up while risk assets and the dollar are down, underscoring investor confusion.
- Craig Shapiro (NinjaTrader) noted the market is pricing “TACO” (Trump always chickens out) as near‑certain, indicating expectations of a possible Trump‑driven pivot.
Why it matters: The gold plunge challenges its safe‑haven status, forcing investors to reassess precious‑metal hedges, while higher oil and Treasury yields add inflation pressure on consumers and debt‑heavy firms, and Bitcoin’s rise amid falling risk assets highlights market uncertainty and the mixed signals across assets underscore the difficulty of pricing geopolitical risk.
