On March 16, the international spot gold price experienced sharp fluctuations, once breaking below the key psychological level of 5,000 US dollars per ounce, with the lowest touching 4,995.21 US dollars, a drop of about 0.5%; gold futures performed even weaker, with a drop of 1.3% to 4,996.96 US dollars per ounce, breaking the market’s expectations for safe-haven assets.

Although the situation in the Middle East has not cooled down, the safe-haven function of gold has not been effectively played, mainly restricted by three major pressures. First, the soaring energy prices have triggered concerns about inflation rebound. High inflation means that monetary policy is difficult to ease, which is bearish for gold that does not generate interest. Second, with the approaching of global central bank interest rate meetings this week, the market is worried that the Federal Reserve and other central banks will release hawkish signals, pushing up U.S. Treasury yields and the U.S. dollar, diverting safe-haven funds from gold. Third, some institutions take profits at high gold prices to supplement liquidity, further exacerbating price fluctuations.

The precious metals sector showed differentiation, with spot silver falling by 1.8% and spot platinum rising slightly by 0.2% against the trend. Analysts said that in the short term, gold will be in a tug-of-war between “safe-haven demand” and “high interest rate expectations”. The central bank’s policy tone will be the key. If it releases easing signals, the gold price is expected to recover the 5,000 US dollar mark; otherwise, it may further decline.