Gold Falls 0.7% on Strong Dollar and Higher U.S. Yields

Gold fell 0.7% to about $4,509 an ounce at the end of the May 17–24 trading week as a firmer dollar and rising U.S. Treasury yields reduced demand for the metal.

Spot gold opened the week near $4,540 and traded mostly between $4,480 and $4,566. Daily moves were volatile, with some sessions gaining about $25 and others dropping as much as $84. The price tested a floor near $4,480 several times before recovering toward the close. Exchange-traded funds recorded outflows as investors shifted into assets that pay interest.

The U.S. Dollar Index traded in a 99.0 to 99.4 range and settled near 99.32 on May 22, making dollar-priced gold more expensive for buyers using other currencies. Benchmark 10-year U.S. Treasury yields rose into the 4.5% to 4.6% area, levels near one-year highs. Higher yields increase the return on bonds relative to gold, which does not pay interest.

Minutes from the Federal Open Market Committee released on May 21 described persistent inflation and reduced expectations for near-term rate cuts. U.S. consumer price data during the week reinforced inflation concerns. Energy prices, supported in part by tensions near the Strait of Hormuz, also factored into inflation readings.

Geopolitical reports that U.S.-Iran negotiations were in advanced stages eased some safe-haven demand for gold. Risk appetite improved and U.S. equities advanced: the S&P 500 closed the week at 7,473, marking an eighth straight weekly gain; the Dow finished at 50,579 with new record closes; the Nasdaq rose to 26,343, supported by technology and AI-related earnings. Bitcoin fell roughly 1.5% to 3% week-over-week to around $76,500–$77,000, and ether declined about 3% to 5% to near $2,060–$2,120, reducing flows into alternative safe-haven assets.

Central banks continued net purchases of gold during the period, supplying steady demand. Gold has declined about 16% from its January 2026 peak near $5,589 per ounce but remains above 2025 trading ranges. Some analysts maintain year-end targets above $5,000 per ounce, citing ongoing central bank diversification and a possible future shift in monetary policy.

Technically, traders identified resistance in the $4,550 to $4,600 area and near-term support around $4,480 to $4,500. Market participants said the next clear directional move will depend on incoming inflation data, any change in Federal Reserve guidance and whether Treasury yields stabilize or geopolitical tensions increase.