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Explained — Four major factors why Gold prices sold off on TuesdayA combination of factors ranging from a stronger US Dollar to the sell-off on Wall Street could be attributed to the pressure seen on Gold prices on Tuesday.By Hormaz Fatakia   March 4, 2026, 5:12:04 AM IST (Published)3 Min ReadGold prices in the spot market fell as much as 5.5% from the intraday highs as the yellow metal temporarily lost its safe haven appeal due to multiple factors.

The precious metal is generally treated as a haven asset, particularly during instances such as the ongoing US-Iran war, but ended up snapping a four-day winning streak on Tuesday, slipping below the mark of $5,100 an ounce mark for the first time after February 19.

Four important factors contributed to the fall in Gold prices on Tuesday.

First, the US Dollar continues to strengthen, proving the fact that despite the recent weakness, investors are choosing the greenback as the primary safe haven during the ongoing situation.

The US Dollar index is now back above levels of 99, posting its biggest two-day rally in nearly a year. All 16 major currencies tracked by Bloomberg fell on Tuesday against the USD, with the Euro falling to the lowest since November last year, before paring the declines.

A stronger US Dollar is negative for Gold as it makes purchasing the asset expensive, particularly for foreign investors.

Second, with the ongoing war in the Middle East, oil prices have seen a sharp surge, with Brent Crude now trading above the mark of $82 for a barrel.

The rising oil prices have stoked inflation fears, which has resulted in dwindling odds of the US Federal Reserve continuing to remain in easing mode through the year.

The futures market had begun the year pricing in three rate cuts, hoping that the nominee chosen by US President Donald Trump to lead the central bank after Chair Jerome Powell's term ends this May, would be more dovish than his predecessor. However, the announcement of Kevin Warsh as the new Fed Chair brought those odds down to two, at least till last Friday.

However, the futures market is now pricing in a 80% chance of only one 25 bps rate cut in the year, mostly in September.

Lower Fed rate cuts is also negative for Gold, as it does not pay any interest of its own, and lower cuts meaning rates will remain higher for longer.

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Third, the US 10-year bond yield was also back above the mark of 4% over the last two sessions. Rising bond yields will prompt investors to choose fixed income assets over riskier ones like Gold, turning out to be negative for bullion yet again.

Lastly, the Dow Jones fell as much as 1,200 points on Tuesday before recovering. The steep fall may have triggered margin calls and analysts believe that some participants sold Gold to cover up for those margin calls in other parts of their portfolio.

Spot Gold prices are currently trading 0.7% higher after Tuesday's fall above the mark of $5,100.Continue ReadingTagsglobal gold pricesgoldGold Prices