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Dovish Federal Reserve signals may support a near-term rebound in gold ETFs.
Iran tensions and Strait of Hormuz risks could limit upside.
3. Given the latest war updates, gold's long-term outlook appears uncertain despite cooling inflation hopes.
Gold prices have been under pressure due to the Iran war. SPDR Gold Trust (GLD - Free Report) has lost about 15.4% over the past month (as of March 30, 2026). However, the losing trend could be shifting for the yellow metal in the coming days, thanks to dovish signals from the Federal Reserve and easing geopolitical concerns tied to the Strait of Hormuz tensions.
Trump Signals Possible End to Iran Conflict
A report by The Wall Street Journal indicated that President Donald Trump may be open to ending the U.S. military campaign against Iran even if the Strait of Hormuz remains partially closed, per Bloomberg, as quoted on Yahoo Finance. This raised hopes for a resolution to the ongoing conflict.
The latest selloff in gold reflected short-term dynamics such as a sudden spike in inflationary fears, a strong dollar, liquidity needs and portfolio rebalancing.However, the Iran war — which involves one of the most crucial energy-focused waterways, the Strait of Hormuz — is less likely to be prolonged, per the latest reported indication received from President Trump (read: Gold ETFs Slide Deeper: More Short-Term Pain but Long-Term Gain?).
Sooner or later, the oil market is likely to stabilize, easing global inflationary pressures. As inflation comes under control, U.S. bond yields may decline, supporting non-yielding assets like gold.
Fed Commentary Eases Rate-Hike Concerns
Meanwhile, Fed Chairman Jerome Powell stated that long-term inflation expectations remain stable despite the latest oil-induced price pressures. He noted that the monetary policy is “in a good place” to adopt a wait-and-see approach, dampening expectations of aggressive rate hikes.
A less hawkish or dovish Fed policy, which means a weaker greenback and contained Treasury bond yields, is a favorable scenario for gold investing. Following Powell’s remarks, U.S. Treasury yields declined, reducing the opportunity cost of holding non-yielding assets like gold.
Mixed Outlook for Gold
While a potential peace deal could trigger a rally in gold, further escalation — such as a ground invasion — may pressure prices.Iran is reportedly considering fees on vessels passing through the Strait of Hormuz, per Bloomberg, as quoted on Yahoo Finance.
Tehran is reportedly urging the Iran-aligned Houthi group in Yemen to prepare attacks on shipping traffic in the Red Sea. Kuwait Petroleum Corp.also reported an attack on a crude carrier near Dubai, as quoted in the above-mentioned source. This suggests that full-on diplomacy is less likely.
Bottom Line
While gold ETFs like GLD and iShares Gold Trust (IAU - Free Report) are likely to recover from the steep slump in the near term (due to the Fed’s assuring comments on U.S. inflation), geopolitics is less likely to return to the pre-war level. Given the latest war updates, it is less likely for gold to go back to the glorious days of 2025. Note that GLD jumped about 44% over the past year, including the latest crash.
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Should You Buy Gold ETFs on Fed's Assurance?
Key Takeaways
Gold prices have been under pressure due to the Iran war. SPDR Gold Trust (GLD - Free Report) has lost about 15.4% over the past month (as of March 30, 2026). However, the losing trend could be shifting for the yellow metal in the coming days, thanks to dovish signals from the Federal Reserve and easing geopolitical concerns tied to the Strait of Hormuz tensions.
Trump Signals Possible End to Iran Conflict
A report by The Wall Street Journal indicated that President Donald Trump may be open to ending the U.S. military campaign against Iran even if the Strait of Hormuz remains partially closed, per Bloomberg, as quoted on Yahoo Finance. This raised hopes for a resolution to the ongoing conflict.
The latest selloff in gold reflected short-term dynamics such as a sudden spike in inflationary fears, a strong dollar, liquidity needs and portfolio rebalancing.However, the Iran war — which involves one of the most crucial energy-focused waterways, the Strait of Hormuz — is less likely to be prolonged, per the latest reported indication received from President Trump (read: Gold ETFs Slide Deeper: More Short-Term Pain but Long-Term Gain?).
Sooner or later, the oil market is likely to stabilize, easing global inflationary pressures. As inflation comes under control, U.S. bond yields may decline, supporting non-yielding assets like gold.
Fed Commentary Eases Rate-Hike Concerns
Meanwhile, Fed Chairman Jerome Powell stated that long-term inflation expectations remain stable despite the latest oil-induced price pressures. He noted that the monetary policy is “in a good place” to adopt a wait-and-see approach, dampening expectations of aggressive rate hikes.
A less hawkish or dovish Fed policy, which means a weaker greenback and contained Treasury bond yields, is a favorable scenario for gold investing. Following Powell’s remarks, U.S. Treasury yields declined, reducing the opportunity cost of holding non-yielding assets like gold.
Mixed Outlook for Gold
While a potential peace deal could trigger a rally in gold, further escalation — such as a ground invasion — may pressure prices.Iran is reportedly considering fees on vessels passing through the Strait of Hormuz, per Bloomberg, as quoted on Yahoo Finance.
Tehran is reportedly urging the Iran-aligned Houthi group in Yemen to prepare attacks on shipping traffic in the Red Sea. Kuwait Petroleum Corp.also reported an attack on a crude carrier near Dubai, as quoted in the above-mentioned source. This suggests that full-on diplomacy is less likely.
Bottom Line
While gold ETFs like GLD and iShares Gold Trust (IAU - Free Report) are likely to recover from the steep slump in the near term (due to the Fed’s assuring comments on U.S. inflation), geopolitics is less likely to return to the pre-war level. Given the latest war updates, it is less likely for gold to go back to the glorious days of 2025. Note that GLD jumped about 44% over the past year, including the latest crash.