Gold prices edged into positive territory on Wednesday after recovering from earlier losses, following the precious metal’s worst quarterly performance in 13 years during the three months ended June.

The yellow metal started the second half of 2026 under pressure before regaining some ground in afternoon trading. Gold futures were last trading slightly above flat at $4,041.30 an ounce, while spot gold rose 0.49% to $4,025.89 an ounce.

After reaching a record high of $5,586.20 on January 29, gold has retreated sharply as investors adopted a more cautious view toward the non-yielding asset amid expectations that interest rates could remain elevated for longer.

Gold lost nearly 16% during the three months ended June 30, marking its worst quarterly performance since the second quarter of 2013. The metal is also down 7.76% year-to-date.

Strong US economy and dollar weigh on gold

Giovanni Staunovo, commodity analyst at UBS, said gold’s traditional safe-haven appeal has recently come under pressure from stronger-than-expected US economic data, rising real yields, a stronger US dollar, and changing market expectations toward a less accommodative Federal Reserve policy outlook.

“The recent price action reflects the sharp rally followed by a consolidation phase that we have seen during previous geopolitical crises,” Staunovo told CNBC via email. “However, gold entered this period with already elevated valuations and supportive expectations for Federal Reserve policy, making it more sensitive to macroeconomic factors at this stage.”

Despite the decline, gold continues to play an important role in investor portfolios, particularly as traditional correlations between asset classes become less reliable, according to the Amundi Investment Institute.

Central bank demand expected to remain supportive

In its semi-annual global investment outlook, the Amundi Investment Institute said a more challenging monetary environment, rising public debt levels, and central banks’ efforts to diversify reserves away from dollar-denominated assets should continue supporting demand for gold and other precious metals during the second half of the year.

Monica Defend, Head of the Amundi Investment Institute, said: “Investors are facing a world where central bank independence is being tested, inflation is becoming more volatile, and concentration risks are increasing.”

She added: “The best portfolios in this new environment must be able to withstand different scenarios. They need diversification across currencies, exposure to real assets and gold, and disciplined participation in equity sectors and long-term structural themes.”

The latest annual survey by the World Gold Council on central bank gold reserves showed that a growing number of central banks worldwide plan to increase their gold holdings over the next year.

“We believe central bank demand for gold, continued diversification away from the US dollar, and concerns about global debt levels will remain important structural support factors,” Staunovo said.

“While the short-term environment appears to be moving into a consolidation phase, investor positioning does not look excessively crowded, and we remain constructive on gold over the next 12 months.”

As Washington and Tehran remain divided over whether international inspectors can verify Iran’s compliance with its nuclear non-proliferation commitments, former officials say the scale, scope, and level of site access will be critical to the success of any future monitoring process.

The details of those arrangements have not yet been defined, although Rafael Grossi, Director General of the International Atomic Energy Agency, said the UN watchdog would work to determine the “when, how, and where” of inspections very soon.

But experts say that does not mean the agency has not already prepared a list of priorities for any potential future inspections.

Laura Rockwood, a former IAEA negotiator on Iran’s nuclear file, told Radio Free Europe/Radio Liberty: “They almost certainly have a plan for what they will do when they go back, what the priorities are, and where they want to go first, second, and third.”

Rockwood, who took part in high-level negotiations on Iran during a 28-year career at the IAEA before retiring in 2013, added: “The key thing is finding out exactly where the enriched uranium is. I would be willing to bet they have a plan ready for the day they need to return.”

Uranium downblending could open new disputes

While US President Donald Trump has said Iran agreed to the highest level of nuclear inspections, Tehran insists it does not plan to allow such inspections.

Article 8 of the US-Iran memorandum of understanding states that both sides agreed to a “minimum methodology” under which Iran’s stockpile of highly enriched uranium would be “downblended on site under IAEA supervision.”

But the details of how this step would be carried out could themselves become a source of disagreement.

Matthew Sharp, who served as director for Iran nuclear issues at the US National Security Council from 2021 to 2022, told Radio Free Europe/Radio Liberty: “If IAEA inspectors are able to measure and characterize both the highly enriched and low-enriched material before downblending, then simple calculations will provide a good understanding of the final product. They would then want to take measurements to verify the product and seal it for future accounting.”

Sharp, now a senior fellow for nuclear affairs at the Center for International Studies at MIT, added: “But if Iran carries out the downblending process itself and then presents the product to inspectors, it would be extremely difficult to know how much highly enriched uranium Iran started with. That could create uncertainty over whether all of the 60%-enriched uranium or other enriched material was actually downblended, or whether some of it remained outside our knowledge.”

For now, the location of roughly 450 kilograms of Iran’s highly enriched uranium remains unclear. Following US and Israeli airstrikes, the stockpile may be buried under rubble inside a fortified facility beneath a mountain, or Iranian authorities may have moved some or all of it elsewhere to conceal it.

But if the material can be successfully located and downblended, the next step would be preventing Iran from re-enriching it later.

Monitoring enrichment is the hardest test

The memorandum states that both sides agreed “to discuss the issue of enrichment and other agreed relevant issues related to the nuclear needs of the Islamic Republic of Iran, based on a satisfactory framework to be agreed in the final agreement.”

Experts told Radio Free Europe/Radio Liberty that verifying such a commitment would have to involve the IAEA.

Kelsey Davenport, Director for Nonproliferation Policy at the Arms Control Association, said: “Any suspension of uranium enrichment is relatively meaningless if it cannot be verified, and if the IAEA does not receive the access needed to ensure there are no covert enrichment-related nuclear activities taking place elsewhere in the country.”

She added: “The level of access, the provision of information to the IAEA, and how quickly Iran complies with agency requests for access will all be extremely important.”

Davenport said that once enrichment levels are reduced to below 5%, the material becomes safer to move abroad and could be stored in an international fuel bank in Kazakhstan.

The idea of removing downblended uranium from Iran appears to have attracted interest among US officials. During a recent background call with reporters, one official said dilution inside Iran represents “the minimum,” adding: “We will push for more than that.”

A senior US official said Washington would rely heavily on the IAEA and US technical teams to verify implementation. “We are not in the trust business,” the official said.

The IAEA has previously verified Iran’s compliance with its commitments under the Nuclear Non-Proliferation Treaty, which Tehran ratified in 1970, as well as under the 2015 Joint Comprehensive Plan of Action.

Lessons from the past will shape future monitoring

Experts say many lessons have been learned from previous experience, highlighting the importance of the IAEA’s Additional Protocol, which provides broader verification and monitoring tools.

Rockwood, now a senior fellow at the Vienna Center for Disarmament and Non-Proliferation and the principal author of the protocol, said: “Under the Additional Protocol, instead of routinely being limited to nuclear material and facilities, we gained access to information and sites related to the entire nuclear fuel cycle, including centrifuge production.”

She added: “If you know roughly how many centrifuges they can manufacture, then you want to know where they are, and we can request that kind of access under the Additional Protocol.”

Iran signed the Additional Protocol in 2003 but never sent the IAEA the formal letter required to bring it into force.

Tehran applied its provisions provisionally between 2003 and 2006, and again for a period during implementation of the JCPOA. But Rockwood noted that “there were many indications of Iranian non-compliance” during that time.

She said that situation may continue, with additional complications.

Iran has suspended IAEA access to sites that were struck by US and Israeli attacks on its nuclear facilities in June last year. That disrupted what Rockwood calls “continuity of knowledge,” meaning the agency lost the ability to track what Iran possesses and where those materials are located.

The scale of the damage also remains unclear, which could further complicate access to the sites, along with the possible presence of unexploded ordnance in some locations.

“There will be uncertainty, and there will probably be more uncertainty than there was before. In fact, I expect that to be the case,” Rockwood said. “Yes, it will be an extremely difficult task.”

Major Wall Street indexes opened lower on Wednesday as renewed tensions between the United States and Iran cast doubt on prospects for peace in the Middle East, leading investors to adopt a cautious stance at the beginning of the second half of 2026.

The Dow Jones Industrial Average fell 88 points at the opening bell, or 0.17%, to 52,231.18.

The S&P 500 also declined by 20.5 points, or 0.27%, at the start of trading to 7,478.84.

Meanwhile, the Nasdaq Composite dropped 174.2 points, or 0.66%, to 26,039.507 at the open.

The sharp rise in copper prices to record levels is prompting a growing number of global companies to replace the metal with aluminum across a wide range of industrial applications.

In addition to being significantly cheaper than copper, aluminum is lighter in weight, making it a more efficient option for many industries, including automotive manufacturing, electric vehicles, power cables, and air-conditioning systems.

Industry sources told Reuters that the current copper-to-aluminum price ratio of around 4.2 times has made substitution increasingly attractive from an economic standpoint.

For comparison, aluminum costs roughly one-quarter as much as copper, while offering around 61% of copper’s electrical conductivity.

However, switching materials is not an immediate process. Companies must evaluate the costs of modifying production lines, redesigning components, and reinvesting in manufacturing facilities before replacing copper with aluminum.

Electric vehicles accelerate aluminum adoption

In the automotive sector, aluminum usage has expanded alongside the growth of electric vehicle production. Beyond reducing manufacturing costs, aluminum’s lower weight — roughly 3.3 times lighter than copper — helps improve energy efficiency and extend vehicle driving range.

Ferrari is among the manufacturers that began using aluminum wiring in its 296 model last year.

Ferrari told Reuters: “In addition to reducing cable cross-sectional area, this solution delivers weight savings of between 15% and 20% for the entire wiring harness.”

BMW has also used aluminum conductors since 2011 in its compact vehicle lineup, later expanding the technology to both low- and high-voltage electrical systems in its latest generation of electric vehicles.

Several Chinese EV manufacturers, including Avatr, XPeng, and Xiaomi, have reportedly adopted aluminum wiring as part of efforts to reduce costs and vehicle weight.

Toyota said it continues to evaluate aluminum as an alternative to copper depending on application requirements, but currently has no plans to replace complete vehicle wiring systems.

Power cables and air conditioning move toward aluminum

Beyond the automotive industry, the shift from copper to aluminum has become increasingly visible in the power cable sector.

Global cable manufacturer Nexans estimates that planned worldwide investment in electricity grids, which could reach nearly €10 trillion by 2030, will continue to support demand for aluminum.

The company said copper will remain the preferred material for highly technical applications, but aluminum is expected to capture a larger share of grid expansion projects due to its lower cost and greater availability.

Prysmian, the world’s largest cable producer, has also reported rising aluminum usage among its customers in recent years. Aluminum-based materials now account for around 40% of the cable materials used by the company, a higher share than five years ago.

“Grid resilience and data centers are expected to experience strong growth in both sectors,” Prysmian said.

The same trend is evident among utility companies. Energy Queensland, the Australian state-owned electricity distributor, has been replacing copper conductors with aluminum across its network for years.

“Aluminum is more cost-effective, offers nearly the same durability, is lighter in weight, and can span longer distances when installing power lines,” company spokesperson Emma Oliveri said.

In the air-conditioning industry, Japanese manufacturer Daikin Industries has also outlined a cost-reduction strategy centered on replacing copper with aluminum.

In its 2025 annual report, the company wrote: “Maximizing cost savings through the transition from copper to aluminum.”

Similar initiatives have been adopted by Lennox International and Carrier Global, both of which have developed aluminum coil technology for air-conditioning systems and heat pumps.

Beyond reducing product weight, aluminum is also said to improve corrosion resistance, particularly in coastal environments.