Commodities

Gold Falls as Trump Rejection of Iran Offer Fans Inflation Fears

A one-kilogram gold bar displayed at the Perth Mint Refinery in Perth, Australia. — A one-kilogram gold bar displayed at the Perth Mint Refinery in Perth, Australia.
Photographer: Matt Jelonek/Bloomberg

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By Yihui Xie

May 10, 2026 at 10:45 PM UTC

Updated on

May 10, 2026 at 11:55 PM UTC

Gold fell as President Donald Trump rejected Iran’s latest peace offer to end the 10-week conflict choking the Strait of Hormuz, fanning inflation fears as weekend clashes in the Middle East threatened a fragile ceasefire.

Bullion traded near $4,698 an ounce, after rising around 2% last week. Peace progress was derailed again after Trump labeled Iran’s latest response to his proposal to end the conflict as “totally unacceptable.” The setback may keep the inflation risk elevated as well as the expectation for higher interest rates, which weigh on non-yielding bullion.