Gold Price Crashed 25%, But Investors are Still Buying - Yahoo Finance

AI desk brief

Gold has fallen nearly 25% since the US-Iran war began, briefly trading down to $3,975/oz on Friday before recovering to around $4,020/oz on Monday, with $4,000 now the key near-term test. The selloff has been driven by higher oil prices reviving inflation fears, an expected Fed hike path, and a reduction in money-manager bullish futures positioning to a net 104,206 contracts as of Oct. 20.

Despite the price decline, investors have continued to buy via ETFs: the World Gold Council said gold ETFs took in a record $31bn in Q3 and holdings rose 67 tonnes in September. But that support is showing signs of weakening, with global ETF holdings down about 6.8 tonnes in the week of Oct. 19 and GLD losing $2.3bn over five days; Wednesday’s Fed decision and Thursday’s US inflation print are the key catalysts for whether gold stabilizes or extends losses.