Driven by the Winds Of War -

A commodities reporter for the mainstream financial media emailed me last week asking me to summarize the state of the gold market.
I gave her lots of words, but could have replaced them all with just this: Gold is going to trade alongside all other risk assets—all of which will be subject to the <a href="https://www.moneymetals.com/news/2026/04/25/war-rates-and-volatility-in-precious-metals-markets-004868">ebb and flow of the U.S.-Iran conflict</a>.
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Good news for an imminent resolution will send oil lower and all other assets higher, while bad news will send the markets lower as oil jumps higher.
Simply put, traders are setting asset prices—including gold at the moment—on Western exchanges. And those traders aren’t concerned about death, destruction, or peace in our time.
They’re solely focused on Fed policy and the prospects for rate cuts.
Thus, gold has performed as a risk asset, and not as the supposed preeminent “safe haven” asset, during this geopolitical crisis. This has been much to the confoundment of mainstream investors who hold the simplistic notion that <a href="https://www.moneymetals.com/news/2026/01/21/where-and-why-for-gold-and-silver-004632">the gold price should soar</a> when bullets and missiles start flying.
As I’ve repeated over and over for literally decades, nothing could be further from the truth. The only reason for an individual to buy gold is to protect savings from an accelerated decline in a currency’s purchasing power.
That’s reason enough these days, of course.
In the meantime, this gold bull market will resume when, and only when, a resolution is reached in the U.S.-Iran conflict.
Unlike many of my colleagues, I’m confident that’s coming.
In the meantime, if you doubt the dynamic I’ve outlined above, consider how gold has traded in such a close correlation with the S&P 500 since the conflict began:
<img src="https://ci3.googleusercontent.com/meips/ADKq_Nbl70Qkv_DuXYR3sqF5CxQaabSIn4H2t7g1kBih2rCQYCKR8FL69dJlfHujoBTZbXs2fCZtWiytEHdU5blDUGIKe5ahw0xs7D69=s0-d-e1-ft#https://mediacdn.espssl.com/6092/2026/GO042726_1.png" alt="Chart – Gold Spot Price Correlated with S&P 500" width="580" data-bit="iit" style="display: block; margin-left: auto; margin-right: auto;" tabindex="0" />
That bottom panel shows the rolling 20-day correlation between the two assets, and it’s been strongly positive since the moment investors realized that a quick resolution to the conflict wasn’t in the offing.
Conversely, gold has traded in a tight inverse correlation to the oil price, as you can see from the solidly negative correlation shown in the bottom panel of this chart:
<img src="https://ci3.googleusercontent.com/meips/ADKq_NawnKGxiv2Ue2V3B8bbsHx7Egsbnf0wmQEgdtHgENswriCfRKeOGW0naz-GXXzpxwpJWaFaLgpLpPOoV6ml0eNoDoYrBirZHLqG=s0-d-e1-ft#https://mediacdn.espssl.com/6092/2026/GO042726_2.png" alt="Chart – Gold Spot Price Correlated with Oil Price" width="580" data-bit="iit" style="display: block; margin-left: auto; margin-right: auto;" tabindex="0" />
So, patience is the order of the day. Once this conflict is in the rear-view mirror, the fundamental—and irreversible—drivers of the gold bull market will reassert themselves.
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