Gold Slips Below $4,000 as Oil Shock and AI Selloff Affects Entire Market
Gold is ending one of its weakest weeks of the year below the $4,000 mark, with the metal’s traditional safe-haven appeal overwhelmed by an energy-driven inflation which scares the public, especially after the AI stocks continuous selloff.
Spot bullion hovered slight below $4,000 a troy ounce after the end of trading session on Friday afternoon, after touching a three-month low. Prices were on track for a weekly loss of more than 3.5%, the second straight weekly decline and the steepest in about four months.
The retreat marks a sharp reversal for a metal that surged above $5,000 an ounce in January as investors scrambled for hedges against fiscal and geopolitical risk. Silver suffered a sharper selloff, dropping 6.4% at one point to roughly $53.92 a troy ounce as worries about industrial demand added to the pressure.
The trigger is the renewed confrontation around the Strait of Hormuz. Attacks on commercial shipping and threats to regional energy infrastructure have slowed traffic through the waterway and rekindled fears of a prolonged supply disruption. Brent crude climbed toward $116.78 a barrel, its highest level in roughly five months, while West Texas Intermediate moved above $103. That is a double-edged sword for gold: geopolitical risk normally attracts buyers, but expensive oil also stokes the inflation that keeps central banks restrictive.
On top of the Strait of Hormuz conflicts, the AI stocks continuous selloff also added some fears to the bullion market, as big data center and semiconductor names kept going lower for the week. High inflation combined with equity selloff dragged down the entire financial markets.
For now, the market’s message is unambiguous: when oil is rising and the Fed is still expected to hike, gold’s safe-haven gloss fades. The Fed’s next decision, and the tone of its statement, will determine whether gold will continue on a deeper slide.
Related assets: Gold, Silver, Palladium, Platinum, Crude Oil, Brent Crude