Gold snaps three-week losing streak even as oil prices rise, triggering stagflation fears

Gold is rebounding strongly, ending a three-week losing streak with spot prices trading above $4,525/oz, marking a more than 3% gain intraday and a 0.65% rise since last Friday. This recovery is significant as it follows a low near $4,099 earlier in the week, with the metal holding key support around $4,100/oz amid rising oil prices above $98/bbl and a firmer U.S. dollar. Market analysts see this rebound as an initial signal that gold's safe-haven role could be reasserting itself despite ongoing geopolitical risks and inflationary pressures. Michael Brown of Pepperstone highlights $4,100/oz as a critical turning point, unlikely to be breached easily by bears, while TD Securities and Britannia Global Markets caution that official gold reserve monetization, especially by central banks like Turkey which sold nearly 60 tonnes recently, and weakening demand from Gulf and East Asian economies are countervailing forces. The gold market remains sensitive to the trajectory of Middle East conflict and resulting energy price dynamics. Stagflation fears, fueled by higher energy costs and potential growth weakness, create a nuanced backdrop that could ultimately benefit gold if central banks respond with easing policies, pushing real yields down. However, experts like Aaron Hill emphasize that meaningful stagflation risks will depend on forthcoming growth indicators such as manufacturing PMIs and employment data, making the near term crucial for gold's directional clarity. Overall, with gold holding above technical support and amid heightened geopolitical uncertainty, the metal is positioned for a possible return to safe-haven buying, though further volatility is expected depending on crisis escalation and central bank behaviors.