Gold prices dropped more than 1% in European trading on Monday, resuming losses after a two-session rebound and moving closer once again to retesting the key $4,000-an-ounce level. The decline was partially limited by a weaker US dollar following the agreement between the United States and Iran to halt hostilities and resume technical negotiations.

Markets are closely monitoring this week’s European Central Bank Forum as investors seek fresh clues that could reshape expectations for global interest rate trends during the remainder of the year.

Investors are also awaiting a series of key US labor market reports this week, which could provide crucial evidence regarding the likelihood of additional US interest rate hikes in 2026.

The Price

• Gold prices today: Gold fell 1.2% to $4,039.48 an ounce, from an opening level of $4,089.04, after reaching an intraday high of $4,089.04.

• At Friday’s settlement, gold gained 1.55%, marking a second consecutive daily advance as it continued to recover from a seven-month low of $3,959.49 an ounce.

• Gold prices declined 1.6% last week, recording a fourth consecutive weekly loss as selling pressure continued to dominate precious metals markets amid the Federal Reserve’s hawkish outlook.

US dollar

The US Dollar Index fell more than 0.2% on Monday, extending losses for a third straight session and reflecting continued weakness in the US currency against a basket of major and minor currencies.

The decline comes as military tensions between the United States and Iran eased in the Strait of Hormuz, with both sides agreeing to resume technical negotiations under the previously established 60-day roadmap.

Iran war developments

• The United States and Iran have halted hostilities, while shipping traffic through the Strait of Hormuz has resumed following weekend clashes.

• The United States carried out strikes against Iranian targets in response to attacks by Iran’s Revolutionary Guard on vessels in the Strait of Hormuz.

• Gulf states condemned Iranian missile and drone attacks on Bahrain and Kuwait.

• Israel announced that it had resumed attacks on Hezbollah positions in southern Lebanon.

• Technical negotiations are scheduled to resume on Tuesday in Doha, with both sides focusing on disputes related to the Strait of Hormuz, particularly freedom of navigation and the management framework for the maritime corridor.

European Central Bank Forum

Markets are closely watching this week’s annual European Central Bank Forum in Sintra, Portugal, as investors reassess the outlook for global monetary policy amid lower oil prices and continued volatility in equity markets.

ECB President Christine Lagarde will open the forum on Monday with a keynote speech, while a high-level panel discussion is scheduled for Wednesday featuring Federal Reserve Chair Kevin Warsh alongside several major central bank governors.

US interest rates

• According to CME Group’s FedWatch Tool, markets currently price a 70% probability that the Federal Reserve will leave interest rates unchanged at its July meeting, while the probability of a 25-basis-point hike stands at 30%.

• Markets also assign a 20% probability that rates will remain unchanged through December, while the probability of a 25-basis-point increase stands at 80%.

• Investors will continue monitoring incoming US economic data and comments from Federal Reserve officials to reassess those expectations.

• A series of highly important US labor market reports will be released this week. Job openings data for May will be published on Tuesday, followed by the ADP private employment report for June on Wednesday. Weekly jobless claims and the official June employment report are both due on Thursday.

Gold outlook

Tim Waterer, Chief Market Analyst at KCM Trade, said that the United States and Iran returned to exchanging military strikes over the weekend, with reports of new attacks from both sides, raising questions about how long oil prices can remain at current low levels and increasing uncertainty surrounding inflation and broader interest rate expectations.

Waterer added that gold could return to the $5,000-an-ounce level this year, but such a move would likely require a sustained easing of geopolitical tensions, a lasting decline in oil prices back to pre-war levels to reduce inflationary pressures, and continued weakness in the US dollar.

SPDR

Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell by approximately 2 metric tons on Friday, marking a fourth consecutive daily decline and bringing total holdings down to 1,005.08 metric tons, the lowest level since September 24, 2025.

The euro fell in European trading on Monday against a basket of global currencies, resuming losses after a two-day recovery against the US dollar and moving closer once again to its lowest levels in 13 months, as renewed geopolitical tensions in the Middle East followed military exchanges between the United States and Iran.

European Central Bank President Christine Lagarde is scheduled to deliver the opening speech at the ECB Forum on Central Banking in Sintra, Portugal, with investors looking for fresh signals on the outlook for European interest rates during the remainder of the year.

The Price

• Euro exchange rate today: The euro fell around 0.1% against the US dollar to $1.1379, from an opening level of $1.1389, after touching an intraday high of $1.1393.

• The euro ended Friday’s session up 0.1% against the dollar, marking a second consecutive daily gain as it continued to recover from a 13-month low of $1.1325.

• The euro lost around 0.75% against the dollar last week, posting a second straight weekly decline amid renewed concerns over a widening interest rate gap between Europe and the United States.

US dollar

The US Dollar Index rose around 0.1% on Monday, resuming gains after a two-session pause driven by correction and profit-taking from a 13-month high, reflecting renewed strength in the US currency against a basket of global currencies.

The advance was supported by demand for the dollar as a preferred alternative investment, particularly after renewed military tensions between the United States and Iran following attacks by Iran’s Revolutionary Guard on several vessels.

Iran war developments

• The United States and Iran have halted hostilities, while navigation through the Strait of Hormuz has resumed following weekend clashes.

• The United States carried out strikes against Iranian targets in response to attacks by Iran’s Revolutionary Guard on vessels in the Strait of Hormuz.

• Gulf states condemned Iranian missile and drone attacks on Bahrain and Kuwait.

• Israel announced that it had resumed attacks on Hezbollah positions in southern Lebanon.

• Technical negotiations are scheduled to resume on Tuesday in Doha, with both sides expected to focus on disputes related to the Strait of Hormuz, particularly freedom of navigation and the management framework for the maritime corridor.

European interest rates

• Reports: The European Central Bank is considering pausing monetary policy normalization in July if energy prices remain at current levels.

• Money markets currently price the probability of a 25-basis-point ECB rate hike in July at around 30%.

• Investors are awaiting additional eurozone data on inflation, unemployment, and wage growth to reassess those expectations.

Christine Lagarde

At 17:30 GMT, European Central Bank President Christine Lagarde is scheduled to deliver the opening address at the ECB Forum on Central Banking in Sintra, Portugal.

The speech could provide further insight into inflation developments across the eurozone and the ECB’s outlook for interest rates during the remainder of the year.

The Japanese yen fell in Asian trading on Monday against a basket of major and minor currencies, resuming losses that were briefly halted on Friday against the US dollar. The currency is close to touching a two-year low, which sits just one point away from its weakest level since 1986, a move that could prompt Japanese authorities to intensify warnings over excessive foreign-exchange moves or even intervene directly to support the local currency if pressure continues.

Market pricing for a Bank of Japan interest rate hike in July remains weak, leaving investors awaiting further data on developments in the world’s fourth-largest economy for new signals that could lead them to reassess those expectations.

The Price

• Japanese yen exchange rate today: The US dollar rose around 0.1% against the yen to ¥161.86, from an opening level of ¥161.71, after touching an intraday low of ¥161.71.

• The yen ended Friday’s session up 0.1% against the dollar, its first gain in five sessions, as part of a recovery from a two-year low of ¥161.94, which stands just one point away from the 40-year low of ¥161.95.

• The yen lost 0.3% against the dollar last week, marking a second consecutive weekly decline amid renewed concerns over the interest rate gap between Japan and the United States.

US dollar

The US Dollar Index rose around 0.1% on Monday, resuming gains that had paused for two sessions as part of a correction and profit-taking from a 13-month high, reflecting renewed strength in the US currency against a basket of global currencies.

The rise came amid buying of the dollar as the preferred alternative investment, especially after renewed military tensions between the United States and Iran following attacks by Iran’s Revolutionary Guard on several vessels.

Iran war developments

• The United States and Iran have halted hostilities, while navigation through the Strait of Hormuz has resumed following weekend clashes.

• The United States carried out strikes targeting Iranian sites in response to Iran’s Revolutionary Guard targeting several vessels in the Strait of Hormuz.

• Gulf states condemned Iranian missile and drone attacks on Bahrain and Kuwait.

• Israel announced that it had renewed attacks on Hezbollah in southern Lebanon.

• Technical negotiations are scheduled to resume on Tuesday in Doha, with both sides focusing on disputes related to the Strait of Hormuz, particularly freedom of navigation and the mechanism for managing the maritime corridor.

Japanese authorities

Japanese authorities are closely monitoring movements in the currency market, especially as the yen approaches its weakest levels in 40 years after breaching the key ¥160-per-dollar threshold, which is widely viewed as a red line that could prompt renewed intervention to support the currency.

Last week, Japanese Finance Minister Satsuki Katayama held an online meeting with US Treasury Secretary Scott Bessent amid growing concerns over sharp currency volatility.

According to sources cited by Reuters, the meeting focused on proposed policies to address the yen’s historic weakness, including possible intervention in the foreign exchange market.

Katayama stressed that government authorities are fully prepared and ready to take decisive action and intervene directly in the foreign exchange market at any time to protect the yen from speculative moves.

Japanese interest rates

• A summary of opinions from the Bank of Japan’s June monetary policy meeting, published last week, showed that some board members called for additional monetary tightening to move the central bank’s benchmark interest rate toward levels considered neutral for the economy.

• Market pricing for a 25-basis-point rate hike by the Bank of Japan at its July meeting currently remains below 25%.

• To reassess those expectations, investors are awaiting more data on inflation, unemployment, and wage growth in Japan.

XRP was trading near the key psychological support level of $1 at the time of writing on Friday, after losing more than 8% since the start of the week.

Data from CoinGlass showed that more than 97% of leveraged long positions in XRP were liquidated over the past 24 hours, while derivatives market indicators continue to support a bearish outlook for the cryptocurrency.

The technical picture suggests that XRP’s next move will largely depend on whether the critical $1 support level can hold.

More than 97% of long positions wiped out

The broader cryptocurrency market remained under pressure this week, with Bitcoin falling to a new year-to-date low of $58,115 on Thursday, triggering a major wave of liquidations across digital asset markets.

XRP followed Bitcoin’s decline, with CoinGlass data showing leveraged positions worth $44.42 million were liquidated, of which approximately 97.11% were long positions, highlighting an excessive concentration of bullish bets on the token.

Derivatives indicators continue to favor the bears

Derivatives market metrics continue to point toward a negative outlook for XRP.

According to CoinGlass data, XRP’s long-to-short ratio stood at 0.94 on Friday, near its lowest level in more than a month.

A ratio below 1 indicates bearish dominance, suggesting traders are increasingly positioning for further downside.

Funding rates also turned negative on Wednesday and stood at -0.0042% on Friday, meaning short sellers are paying long-position holders. The reading reflects persistent negative sentiment across the market.

Limited signs of optimism emerge

Despite the pressure, some indicators suggest pockets of optimism remain.

According to SoSoValue data, spot XRP exchange-traded funds recorded net inflows of $7.36 million through Thursday this week.

If Friday trading does not produce significant outflows, XRP will be on track to post its eighth consecutive week of net inflows, a streak that began on May 8.

A continuation or acceleration of that trend could provide some support for XRP and help limit further declines.

Inflation and interest rates

The US Personal Consumption Expenditures (PCE) Price Index rose 4.1% in the 12 months through May, matching economists’ expectations in a Reuters poll.

Traders currently assign around a 60% probability to a US interest rate hike in September, down from a previous estimate of 64%, according to CME Group’s FedWatch Tool.

Jim Wyckoff, market analyst at American Gold Exchange, said gold is experiencing a modest rebound after coming under selling pressure earlier this week.

He noted that higher interest rates and tighter monetary policy reduce the appeal of gold as a non-yielding asset, as such conditions typically boost bond yields and increase the attractiveness of income-generating investments.