Gold prices fell on Friday after failing to hold above $4,400 and are on track to decline for the second consecutive session. The yellow metal is currently trading above the daily pivot point of $4,312; if it manages to stay above this level, it could retest the $4,359 then $4,393 levels. On the downside, if the price falls below the pivot point, it could retreat toward support levels near $4,277 then $4,250.
Global markets remain focused on a combination of escalating geopolitical tensions, shifting monetary policy expectations and renewed volatility across major asset classes. The United States’ threat to maintain its naval blockade on Iran indefinitely has heightened concerns over regional stability and global energy supplies, while softer-than-expected U.S. producer price data has added uncertainty to the outlook for Federal Reserve policy and weighed on the dollar. Meanwhile, oil prices have recovered part of their previous-session losses as geopolitical risks, particularly those surrounding Iran and the Strait of Hormuz, continue to provide support to crude prices. Together, these developments are keeping investors cautious as they assess the outlook for currencies, energy markets and the broader global economy.
Market Watch
United States Threatens to Maintain Naval Blockade on Iran Indefinitely
The United States has threatened to maintain its naval blockade on Iran indefinitely, marking a further escalation of pressure on Tehran amid stalled ceasefire talks and heightened tensions in the Gulf region and the Strait of Hormuz.
U.S. Defense Secretary Pete Hegseth said Thursday that the U.S. Navy has the capabilities needed to sustain the blockade of Iranian ports “indefinitely,” explaining that Washington can rotate naval vessels deployed in the region to maintain its presence and enforce the blockade. The move comes as the Trump administration seeks to increase economic pressure on Iran and push Tehran toward concessions in negotiations.
Meanwhile, U.S. Treasury Secretary Scott Bessent said Washington is preparing what he described as unprecedented economic and financial measures against Iran, as part of efforts to further isolate Tehran economically. The blockade has already contributed to a sharp decline in Iranian oil exports.
The U.S. threats have also raised fresh concerns over global energy supplies, particularly because the Strait of Hormuz is one of the world’s most important routes for transporting oil and natural gas. Shipping data showed that tanker traffic through the strait remains below the average level for August, amid increased security risks and continued tensions between Washington and Tehran.
The developments quickly affected oil markets, with crude prices rising during Friday’s trading session as concerns over potential supply disruptions returned. Brent crude rose by around 90 cents to approximately $87.97 per barrel, while West Texas Intermediate gained about 91 cents to $82.16 per barrel, with both benchmarks on track for weekly gains of around 4%.
Markets are now closely watching developments in negotiations between Washington and Tehran, as well as any further military moves or restrictions on shipping through the Strait of Hormuz. Such developments are likely to remain key factors determining the direction of oil prices and global markets in the coming days.
Dollar Volatile After Producer Price Index Falls
The U.S. dollar traded in a mixed and volatile manner on Friday after fresh U.S. inflation data showed that producer prices were unchanged in July, easing concerns about persistent inflation and prompting investors to reassess expectations for the Federal Reserve’s monetary policy.
The U.S. Bureau of Labor Statistics reported that the Producer Price Index (PPI) was unchanged in July, following a revised 0.1% decline in June. Economists had expected producer prices to increase by 0.2%. On an annual basis, the PPI rose 4.7% in July, slowing from a 5.5% increase in June.
The monthly reading was supported by a 0.7% decline in prices for final-demand goods, while prices for final-demand services increased 0.2%. Energy prices also fell sharply, with final-demand energy prices declining 3.1% during the month.
The softer-than-expected data reduced expectations for another Federal Reserve rate hike. According to Reuters, futures markets showed the probability of a September rate hike falling to around 35%, compared with 40% a day earlier. The dollar index briefly declined to 99.80 before recovering slightly and was last up around 0.02% at 99.96.
The latest PPI figures came after consumer inflation data also showed signs of moderation, reinforcing expectations that the Federal Reserve may keep interest rates unchanged at its September meeting. However, inflation remains above the central bank’s 2% target, while higher oil prices could create renewed inflationary pressure in the coming months.
Oil Prices Erase Some of the Previous Session’s Losses
Oil prices rose on Friday, recovering part of the previous session’s losses, supported by renewed geopolitical tensions in the Middle East. The move came after the United States threatened to maintain its naval blockade of Iran indefinitely, reviving concerns over potential disruptions to global crude supplies.
Brent crude futures rose by around 90 cents, or 1.03%, to $87.97 a barrel, while U.S. West Texas Intermediate (WTI) crude futures gained approximately 91 cents, or 1.12%, to $82.16 a barrel in early trading. The rebound followed a decline of more than 2% in the previous session.
Oil prices came under pressure on Thursday amid concerns over weaker global demand and rising U.S. crude inventories. The market was also affected by downward revisions to 2026 oil-demand growth forecasts from both OPEC and the International Energy Agency (IEA).
Meanwhile, the latest escalation between Washington and Tehran shifted market attention back toward supply risks, particularly those surrounding shipping through the Strait of Hormuz, one of the world’s most important oil transit routes. Shipping data showed that nine commodity vessels passed through the strait on Thursday, up from five the previous day, but still below the August daily average of 12 vessels.
Analysts said geopolitical risks continue to provide support for oil prices despite pressure from higher U.S. inventories and weaker demand expectations. Susan Bell, senior vice president of oil markets at Rystad Energy, said the broader geopolitical environment is preventing a sharper decline in crude prices.
Despite Thursday’s losses, both Brent and WTI are on track to record weekly gains of around 4%, supported by continued concerns over supply disruptions and tensions surrounding the Strait of Hormuz. Oil prices are likely to remain highly sensitive to any further developments involving the conflict between the United States and Iran and shipping activity in the region.