Gold price falls below $4,000 as stock market selloff triggers liquidity pressure - Equiti Global

AI desk brief

Gold briefly slipped below $4,000/oz as the equity selloff triggered liquidity-driven selling, even though Treasury yields fell and markets pushed the odds of a 25 bp Fed hike next week to below 10%. Spot gold was last quoted at $4,014.86, down 0.3% in Asia, after touching an intraday low below $3,990; the metal is on track for its worst weekly performance since June and has fallen more than 20% since the late-February US-Iran conflict began.

The note argues the current decline is being driven more by forced deleveraging and margin-related cash raising than by a deterioration in gold’s macro case. Brent above $113/bbl, on renewed Saudi infrastructure attacks, keeps inflation risks elevated and complicates the Fed outlook: weaker growth and lower yields should support bullion, but persistent energy inflation may limit policy easing and keep real rates restrictive.