Can Gold Break Higher This Week?

Gold is caught between safe-haven demand and the pressure of a firmer dollar as markets head into a week shaped by oil volatility and inflation risk.

Renewed tension around the Strait of Hormuz has pushed Brent around $96.8 and WTI above $90. That has brought energy risk back into focus. As oil rises, inflation concerns become harder to ignore. This has also helped lift USDX to 98.38, tightening financial conditions and making it harder for XAUUSD to extend gains smoothly.

Price action already reflects that tension. Spot gold traded around $4,809.71 last week, while June futures held near $4,829.40. This shows that gold remains well supported, but it is no longer moving in a straight line higher.

The same headlines that support defensive demand are also raising expectations that inflation could stay higher for longer. That supports the dollar and keeps yields elevated. This is why gold has remained resilient without breaking clearly into a fresh leg higher.

Gold surged 65% in 2025, set 53 new all-time highs and briefly reached $5,598 per ounce in January 2026. It then eased back to around $4,795, leaving it roughly 14% below the peak. After such a strong rally, some consolidation was always likely, especially in a tighter liquidity environment where short-term traders are quicker to take profit when the dollar strengthens.

Even with that pullback, the broader backdrop remains supportive because reserve demand has not disappeared. Central banks bought more than 1,000 tonnes of gold annually from 2022 through 2024 and added another 863.3 tonnes in 2025. Although that was 21% lower than in 2024, it was still far above the 2010 to 2021 annual average of 473 tonnes.

Gold also overtook US Treasuries in late 2025 to become the world’s largest reserve asset by value. That supports the view that recent weakness is being absorbed within a broader long-term shift, rather than signalling a collapse in confidence.

Attention now turns to the week’s data, which could decide whether gold steadies further or comes under renewed pressure. US Retail Sales is forecast at 1.4% after 0.6% previously. UK CPI is expected at 3.3% after 3.0%, while Japan’s National Core CPI is seen at 1.7% after 1.6%.

If oil remains elevated and incoming data stays firm, markets may continue to delay rate-cut hopes. That would support the dollar and keep gold’s upside more uneven. If inflation pressure begins to ease and USDX softens, XAUUSD may have more room to recover with greater confidence.

Dive into the full report on gold’s outlook as markets weigh oil shocks, dollar moves and inflation risk.