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Gold prices advanced in Asian trading on Wednesday after U.S. President Donald Trump and Iran agreed to a two-week ceasefire to finalize talks on ending the war.
Spot gold (XAUUSD:CUR) rose 1.8% to $4,794.08 per ounce at press time, after gaining as much as 3.1% earlier in
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It is an old market saying, but it has never felt more apt: when people are worried about the future, they buy gold — when they are worried about the present, they sell it.
While the Iran war has raised longer-term concerns over energy security and global stability, the immediate fallout, in the form of surging oil prices and renewed inflation fears, has forced investors to prioritise liquidity and higher-yielding assets over metals.
Gold hit an all-time high of $5,602 (€4,873) at the end of January and looked to be heading higher still in early March, but has since dropped nearly 25% to a low of $4,100 (€3,567), trading around $4,500 (€3,915) at the time of writing.
The decline marks a dramatic pullback from gold’s extraordinary performance last year.
In 2025, the metal delivered one of its best annual gains in decades, rising more than 60% to record levels as central banks accumulated reserves and investors sought protection amid economic uncertainty.
The drop in 2026 has triggered a swift unwinding of leveraged positions in futures and exchange-traded funds which were riding last year’s tremendous rise.
This sharp reversal defies the traditional role of the metal as a refuge during geopolitical turmoil, with a stronger US dollar and rising bond yields proving far more influential.
Rising US Treasury yields and a firmer US dollar have been the dominant headwinds for precious metals.
Higher oil prices stemming from the Iran war have lifted inflation expectations, prompting markets to price in fewer Federal Reserve rate cuts or even the possibility of tighter policy for longer, including potential hikes that were previously unexpected.
This has increased the opportunity cost of holding non-yielding gold, while the US dollar’s strength has made it more expensive for international buyers.
The result has been a classic “flight to liquidity” rather than the expected flight to quality risk assets, as leveraged traders facing margin calls accelerated the sell-off.
The correction for metals has been one of the sharpest in recent memory.
Silver, which often amplifies gold’s moves, followed with an even bigger drop.
The white metal reached an all time high of $121 just one day after gold, on 29 January, but it has since dropped roughly 50% to as low as $61.
At the time of writing, it is trading at around $70.
Silver enjoyed an even more spectacular rally than gold in 2025, surging roughly 145% thanks to robust industrial demand from solar panels, electronics and electric vehicles, combined with investment buying.
In 2026, however, it has also declined sharply amid the same pressures of US dollar strength and higher yields, although its industrial fundamentals continue to offer longer-term support.
Gold’s reputation over the past year as the go-to refuge in a crisis is taking a battering as war rages and threatens to expand in the Middle East and financial markets buckle.
Spot gold plunged to a 2026 low near $4,100 in early trading on Monday before recovering sharply to above $4,400 after US President Donald Trump announced he was postponing military strikes against Iranian power plants for five days following “very good and productive conversations” with Tehran — a swing of around $300 in the space of hours.
The metal has still shed more than 20% since hitting a record high of $5,594.82 an ounce on 29 January.
Silver has lost nearly half its value since hitting an all-time high of $121.67 in January, in one of the more violent collapses in the precious metal’s modern history.
Spot silver was down 8.9% at $61.76 — a year-to-date low and almost half of its $117 level on 28 February, when the Iran war began.
The counterintuitive sell-off has rattled investors who piled into precious metals expecting them to hold firm.
The dollar dropped against the euro after Trump’s comments and traded around $1.1572 to the euro on Monday afternoon, while the pound was up at a rate of $1.3341. The yen traded at around ¥159.47 per dollar.
The main culprit is the oil shock. As crude surges past $100 a barrel, bond yields are climbing and the US dollar is strengthening, making precious metals far less attractive to investors bracing for higher interest rates.
The dollar has emerged as one of the clearest safe-haven winners, strengthening over 2% so far this month.
For a non-yielding asset like gold, that is a double blow.
The prospect of higher interest rates as a result of the war is also boosting government bonds among investors, at the expense of precious metals.
Yet seasoned observers urge caution before declaring the gold story over.
Russ Mould, investment director at AJ Bell, points out that gold is in the middle of only its third major bull run since 1971 and that the previous two also caused stomach-churning fluctuations.
“Neither interest rates staying higher for longer nor a stronger dollar may help the investment case for precious metals, but both the 1971-1980 and 2001-2010 bull runs saw several retreats which did not ultimately nullify or prevent major gains,” Mould said.
“So it may be too early to give up on gold just yet,” he continued.
During the first bull run, triggered by Richard Nixon’s decision to decouple the dollar from the gold standard in 1971, gold surged from $35 to a peak of $835 an ounce by January 1980, but not before enduring three mini bear markets and five corrections of 10% or more along the way.
The second run, which began in 2001 amid the wreckage of the dotcom bust and gathered pace through the 2008 financial crisis, was equally volatile, featuring two bear markets and another five double-digit corrections before gold peaked near $1,900 in 2011.
This third advance has been no smoother.
“A swoon of more than 20% caught some bulls off guard in 2022, as the world emerged from lockdowns, and 10%-plus corrections in each of 2016, 2018, 2020, 2021 and 2023 [gold peaks] warned that volatility was never far away,” Mould noted.
The paradox at the heart of the current sell-off is that the very crisis that might once have sent investors flooding into gold is now working against it.
Rising oil prices fuel inflation fears, inflation fears fuel expectations of higher interest rates and higher rates make gold — which pays no dividend and costs money to hold — less appealing.
“Gold’s status as a haven may now be tarnished in the eyes of some,” Mould said, “as the precious metal is falling in price even as war roils the Middle East and financial markets alike.”
But not everyone is convinced the metal’s moment has passed.
The inflation and stagflation of the 1970s, partly triggered by the oil shocks of 1973 and 1979, ultimately made gold the standout portfolio pick of that decade.
A prolonged conflict that stretches government finances — pushing welfare costs up and tax revenues down, on top of surging defence spending — could yet revive that dynamic.
If central banks respond to recession with fresh rate cuts and quantitative easing, the case for gold as a store of value comes roaring back.
“The war in Iran and its effect on oil and gas prices is stoking fears of inflation and how that could force central banks to raise interest rates,” he concluded.
EACH year around 1.4million Brits head to Portugal’s Algarve – so why not explore a quieter Portuguese gem that is cheaper?
Portugal’s Silver Coast – also known as Costa de Prata – stretches for 155 miles from central to western Portugal.
And it offers several different holiday types.
Think dramatic landscapes to be explored, beaches to sunbathe on and historic towns to investigate.
Spanning from north of Lisbon to near Porto, the Silver Coast tends to be less crowded than the Algarve.
One spot you can head to is Nazare, known for having the world’s biggest surfable waves.
The old fishing town features a long, crescent shaped beach with white sand and crystal clear water.
And this is one of the spots in the town where you will find surfers tackling huge waves.
In fact, it is the Nazaré Canyon that is the largest underwater canyon in Europe, that produces the town’s colossal waves.
Away from the water, the town also has a lot of narrow streets to explore with cosy restaurants serving fresh seafood.
For example, you could head to Restaurante Maria do Mar, which is the best-rated restaurant on TripAdvisor in the area, serving ‘Maria do Mar’ fish stew for just €9.50 (£8.20).
Surfers should also head to Ericeira, which is another popular surf town.
It is widely known as the ‘surfing capital of Europe‘ and is home to one of only two World Surfing Reserves in Europe.
If you are not a surfer, then simply enjoy the town’s beautiful beaches such as Praia dos Pescadores (Fisherman’s Beach) or Praia do Norte.
There’s also Obidos, which has a charming, medieval walled town.
In the picturesque town you can walk through Moorish gates and see colourful houses covered in bright pink flowers in summer.
The medieval walls encircle the entire village, which you can explore.
There’s even a spot that is dubbed the ‘Venice of Portugal’ – Aveiro.
The nickname comes from the colourful boats that sail down canals in the town.
Originally, the boats – called moliceiros – were used to carry seaweed that had been harvested, but now they offer tours to visitors along the canals and past Art Nouveau buildings.
In the Old Town, you’ll find cobblestone streets with small fish and coastal images embedded into the cobbles.
Make sure to visit Ponte dos Laços de Amizade (Bridge of Friendship Ties) where couples tie ribbons on to the bridge.
And definitely grab some Ovos Moles which are sweets from the area.
They are egg yolk and sugar mixed together and then moulded into different shapes, like seashells.
Drop by Confeitaria Peixinho, the oldest Ovos Moles shop in Aveiro, which has been running since 1856 – each Ovos Mole costs about €1.60 (£1.38).
Nearby Aveiro there is another spot worth visiting called Costa Nova.
Here you will find rows upon rows of colourful striped beach cottages.
Elsewhere along the Silver Coast, you can visit the coastal village of Foz do Arelho and two beaches created by a saltwater lagoon.
Both feature white sand and are the ideal places to go paddleboarding.
If you want to grab a bite to eat, there are plenty of cafes and restaurants along the promenade.
Several of the pubs and bars along the Silver Coast sell beers for €1.25 (£1.08), like at Marcianus 3.0 in Foz do Arelho, where you can pick up a bottle of Imperial beer for this price.
Depending on where you wish to go on the Silver Coast, you can fly into either Lisbon or Porto Airports.
One-way flights from the UK to Lisbon or Porto cost as little as £15 per person in April.
Also, depending on where you want to visit, there are a number of different accommodation options.
The average cost for a night in a four-star hotel in the region costs between £65 and £80.
For more places to explore in Portugal, there’s a secret side to the country that has just been crowned one of the best places in Europe to visit this year.
Plus, the pretty city that was the birthplace of the first king of Portugal that is set to be big this year.
