Gold prices fell about 2% to 4% during the week around mid-May 2026, trading near $4,500 to $4,700 per ounce, pressured by accelerating US inflation and rising US Treasury yields [1, 2, 3, 4, 5, 6, 7, 8, 9]. US wholesale inflation accelerated in April 2026 to its fastest pace since 2022, while the consumer price index rose the most since 2023, boosting expectations of higher interest rates from the Federal Reserve [1, 2, 3, 4, 5, 6, 7].
Yields on US 10-year Treasury bonds also rose to levels near their highest since mid-2025, pushing bond yields and the US dollar higher and weighing on gold’s appeal as a non-yielding asset. Analyst Edward Meir said, "美元今日表現相當強勁，加上美債殖利率上升，全球債券也出現了殖利率上升的趨勢，使貴金屬市場加速集體拋售。" [8]. Marc Chandler added that rising bond yields alongside dollar strength were the main factors behind gold’s weakness last week, noting that inflation persistence and potential for sustained high Fed rates overshadowed geopolitical safe-haven demand [5].
The gold price traded in a narrow range but weakened since the Middle East conflict began in February 2026, falling more than 13% overall [4, 5]. Geopolitical tensions including partial closure of the Strait of Hormuz lifted energy prices but provided only limited sustained support for gold [4, 5, 6, 7, 10, 11, 12]. Some market participants see gold’s current weakness as near-term, expecting a rebound later in 2026 due to continued central bank buying and repositioning. However, analysts Daniel Hynes and Soni Kumari said, "Inflation expectations, higher yields and a stronger dollar are likely to keep gold under pressure in the near term" [4]. A forecast disagreement persists, with some expecting prices to rebound to $6,000 per ounce or higher by mid- to late-2026 [5, 7], while others have pushed that target into mid-2027 [4, 8].
Other precious metals also declined sharply. Silver dropped 7% to 13% since early May 2026 amid similar inflation and rate hike concerns [4, 5, 6, 7]. Meanwhile, US stock markets, particularly technology and semiconductor sectors, showed volatility and declines due to inflation and interest rate worries around mid-May [6, 7, 8, 9, 10, 11, 12].
US President Donald Trump announced proposals to lower costs on beef and gasoline amid rising consumer prices this year, aiming to relieve some inflation pressures [3, 5]. In the Middle East, US-Iran tensions remain unresolved. The US canceled a planned strike on Iran after diplomatic talks, maintaining heightened but controlled conflict risks [4, 5, 12].
On May 18, gold prices fell in Asian markets by 0.79%, pressured by inflation concerns, stronger dollar, and slow reopening of the Strait of Hormuz [10, 11, 12]. Gold futures closed the week down more than 4%, with no clear near-term relief as inflation and Treasury yields remained elevated [5, 7, 8].
