Gold prices moved lower Monday as a stronger U.S. dollar and profit-taking offset support from ongoing geopolitical uncertainty.

Spot gold fell 0.6% to $4,349.99 per ounce by 1046 GMT, while U.S. gold futures declined 0.8% to $4,387.80.

The retreat came after a strong session Friday, when bullion climbed to $4,399.41 per ounce, its highest level in one week. At the time, lower oil prices helped ease concerns over persistent inflation.

The dollar’s latest advance contributed to the pressure on gold. Since the metal is priced in dollars, a stronger U.S. currency makes bullion more expensive for buyers using other currencies.

Ricardo Evangelista, director and CEO of ActivTrades, said the stronger dollar and profit-taking following Friday’s rebound were weighing on gold.

Oil prices also declined Monday, falling to their lowest level in more than a week as investors watched for signs of diplomatic progress in the Iran war during this week’s United Nations meeting.

Movements in the energy market remain important for precious metals. Lower oil prices can ease inflationary pressure and potentially reduce expectations for aggressive monetary tightening. However, continued geopolitical tensions may sustain demand for assets traditionally considered stores of value.

Uncertainty remained elevated. Iran and the United States issued new threats over the weekend. President Donald Trump warned Iran of severe economic consequences or an attack on its leadership if it failed to reach a deal, while Iran’s military said it would respond harshly to any new attack.

Interest-rate policy is also affecting bullion. The Bank of Japan raised rates Friday, following rate increases from the Federal Reserve and European Central Bank.

Higher interest rates can pressure gold by making interest-bearing assets relatively more attractive. Traders were pricing in an 88% probability of another U.S. rate increase in December, according to the CME FedWatch Tool.

Evangelista said persistent inflation and further monetary tightening could put downward pressure on gold toward $4,000. He also said a de-escalation in the U.S.-Iran conflict could ease inflation concerns, push yields lower and weaken the dollar, potentially allowing gold to move toward $5,000.

Other precious metals saw limited movement. Spot silver declined 0.2% to $66.08 per ounce, while platinum was unchanged at $1,800.33 and palladium was little changed at $1,301.83.

For gold investors, central-bank policy, currency movements, oil prices and developments in the Middle East continue to be key factors shaping the metal’s direction.

Original article