Gold Near 7-Month Low, Falls Below $4,000 as Stronger Dollar and Fed Rate Hike Expectations Weigh

Gold price extended their decline in Asian trading on June 25, 2026, falling below the $4,000-per-ounce level for the first time since November 2025. The decline came as the US dollar remained near a 13-month high, and market participants increased bets on additional interest rate hikes by the US Federal Reserve. 

Spot gold fell 0.7% to $3,970.47 per ounce, while US gold futures declined 0.5% to $3,990.90. The precious metal has now fallen nearly 30% from its record high of $5,595.46 per ounce reached in January 2026. 

Stronger Dollar and Rate Hike Expectations Pressure Gold 

The US dollar remained supported after six consecutive sessions of gains, making gold more expensive for buyers using other currencies. 

Market expectations for further monetary tightening also weighed on sentiment. According to CME FedWatch data, traders are pricing in around a one-third probability of a Federal Reserve rate hike in July and a 66% chance of policy tightening by September. 

Higher interest rates typically reduce the appeal of gold because the metal does not generate interest income, increasing the opportunity cost of holding bullion. 

Easing Geopolitical Risks Reduce Safe-Haven Demand 

Gold's decline also reflected softer safe-haven demand as geopolitical concerns eased. 

Progress in US-Iran peace efforts and lower oil price reduced some of the risk premium that had supported precious metals earlier in the year. Market participants have increasingly shifted their focus toward interest rates and financial conditions rather than geopolitical uncertainty. 

Investors are also awaiting the release of US Personal Consumption Expenditures (PCE) data, the Federal Reserve's preferred inflation measure, for further indications on the future path of interest rates. 

Read More: Gold Rate: Dubai vs India Gold Prices on June 25, 2026 

Other Precious Metals Also Decline 

Silver price fell 1.7% to $56.44 per ounce after declining more than 6% in the previous trading session. 

Platinum price also remained under pressure, slipping 1.5% to $1,561.60 per ounce following a 4.5% decline on Wednesday. 

Analysts noted that while the silver market is expected to remain in deficit, some of the demand drivers that supported price earlier are showing signs of moderation. 

Conclusion 

Gold price remained under pressure as a stronger US dollar, expectations of further Federal Reserve rate hikes, and easing geopolitical concerns reduced demand for safe-haven assets. Investors are now closely watching upcoming US inflation data for additional signals on monetary policy.