Gold Falls 11%, Biggest Weekly Fall Since 1983

The war with Iran is also disrupting global oil flows, particularly in the Strait of Hormuz, causing fears of a prolonged energy crisis.

US President Donald Trump said on Friday that he is considering “winding down” its military efforts in the Middle East. However, the US has sent thousands of additional troops to the region as airstrikes continue.

At the same time, traders are anticipating that the US Federal Reserve will hold interest rates steady this year, making bonds and other yield-bearing investments more appealing than gold.

The Federal Reserve chair, Jerome Powell, also noted on Wednesday that higher energy prices would push up inflation, at least over the short term.

Bitcoin has clawed back lost ground on gold this month

Gold has outperformed Bitcoin (BTC) over the past 12 months, increasing 48.5% while the cryptocurrency has retraced 16.5% over the same timeframe.

Bitcoin has responded better to the Iran conflict, however, up more than 11.6% to $70,535 since the US and Israels first attack on Iran.