Gold prices fall as strong US jobs data and Iran tensions weigh on markets

Gold prices faced near-term headwinds at the start of trading on April 6, as investors weighed signs of resilience in the U.S. labor market and heightened risk around a potential prolonged U.S.-Iran conflict.

Early trading: Asia drop amid U.S. labor and Middle East risk

Global gold prices opened the morning session in Asia with a sharp decline. The move reflected investor concerns that a conflict involving Iran could disrupt markets and, at the same time, that oil-driven inflation pressures could keep interest rates higher for longer.

Although gold ended last week up more than 4%, it met strong resistance near 4,800 USD/oz. Analysts said the market remains pulled between demand for hedging against geopolitical risk and worries about inflation and higher interest rates, particularly after oil.

Oil and the dollar firm; Middle East escalation remains in focus

Brent crude rose about 2% in London, while WTI in New York climbed to just over 111 USD/bbl and 113 USD/bbl, respectively. The U.S. dollar also strengthened, with the Dollar Index up about 0.2% to above 100.2.

U.S. President Donald Trump issued a “final ultimatum” via a Truth Social post over the weekend, demanding Iran open the Hormuz Strait no later than Tuesday or the U.S. would strike Iran’s infrastructure, including power plants and bridges. In a televised address last Wednesday, Trump said the war could last “2-3 weeks,” adding that the U.S. could strike Iran “especially hard” to pressure Tehran.

Alex Kuptsikevich, head analyst at FxPro, said Polymarket is pricing in a 65% chance that the war lasts until the end of June, warning that shutting the Hormuz Strait by then would be a “real disaster for the global economy.” He said the uncertainty continues to weigh on gold.

Market drivers: inflation expectations and rate outlook

Kuptsikevich said the Middle East conflict is pressuring gold because markets expect central banks to tighten policy to fight higher inflation driven by higher oil prices. He added that such rate hikes may not be warranted because fuel-price shocks hit consumers and the economy, which would call for monetary policy to be loosened rather than tightened.

He forecast that in the medium term gold could retreat to around 4,200 USD/oz without breaking the long-term uptrend. He also said that if gold breaks below 4,200 USD/oz, it would signal a reversal of the three-year uptrend, while recovery from that level would suggest the uptrend remains intact.

Spot prices and silver performance

As of 6:30 a.m. Vietnam time, spot gold in Asia was down nearly 63 USD/oz from last week’s New York close, about 2.4% lower, trading above 4,615 USD/oz.

Silver fell about 1.8%, trading at 71.85 USD/oz.

Analysts: Iran conflict and inflation remain key; 5,000 USD/oz seen as psychological

Nick Cawley, senior analyst at Solomon Global, said the Iran conflict remains the key determinant for gold in the near to medium term. He said inflation is still a concern and that central banks are expected to begin tightening policy in the coming weeks. However, he noted that if markets view the inflation impulse as short-term and expect rates to ease from the end of this year, pressure on gold may remain limited.

Cawley said the 5,000 USD/oz level is more of a psychological milestone than a real technical resistance. He added that if gold breaks through that level in the coming weeks, it could retake its late-January high.

U.S. data backdrop: nonfarm payrolls support rate-cut skepticism

U.S. nonfarm payrolls data released on Friday showed the nonfarm sector added 178,000 jobs in March, reversing February’s loss of 133,000. The figure beat economists’ Dow Jones survey forecast of 59,000 new jobs.

The market interpreted the report as evidence of labor market resilience, reinforcing expectations that the Federal Reserve will not cut rates this year.

What investors will watch this week

Beyond developments in the U.S.-Iran conflict, investors are expected to focus on several key U.S. releases: the Fed’s March meeting minutes due on Wednesday, the fourth-quarter 2025 GDP update due on Thursday, the Personal Consumption Expenditures (PCE) price index due on Thursday, and the CPI due on Friday.