Overview
- The U.S. has carried out consecutive strikes on Iranian targets and Iran has responded with attacks on U.S. facilities, a mid‑July escalation that disrupted tanker routes through the Strait of Hormuz and raised supply risk.
- Brent and WTI crude have rallied sharply on the shipping disruptions with Brent on track for double-digit weekly gains, which traders say increases the chance that energy costs feed into broader inflation.
- Federal Reserve officials, including Chair Kevin Warsh, have stressed a commitment to return inflation to 2 percent and signaled readiness to keep policy restrictive if price pressures persist, helping lift Treasury yields and the dollar.
- Global spot gold dropped toward the $3,990–$4,008 an ounce range and is set for multi‑week losses as higher yields and a firmer dollar reduce demand for non‑yielding bullion while local markets in India and Pakistan mirrored the international decline.
- Technicians note support near $4,000 and some strategists see scope for a Q3 rebound if the conflict calms or yields fall, but analysts warn sustained oil-driven inflation could keep policy tight and prolong pressure on prices.