Gold falls below $4,000 as AI rally and Iran deal erode safe-haven demand

Gold dipped below $4,000 per ounce for the first time since November 2025, deepening losses Thursday as a stronger dollar and rising rate expectations added pressure.finance.yahoo+1
The selloff accelerated as Micron Technology delivered a blowout forecast, fueling an AI-driven stock rally that pulled capital away from safe havens.youtube+1
A 60-day U.S. waiver on Iran oil sanctions removed a key geopolitical risk premium that had supported gold prices since March, according to Reuters.reuters

Spot gold fell below $4,000 per ounce on Wednesday, June 24, for the first time since November 2025, as a strengthening U.S. dollar, rising rate expectations, and a rapid unwinding of geopolitical risk premiums combined to extend a punishing selloff from the precious metal's January highs.finance.yahoo+2

The decline deepened on Thursday, with gold trading near $3,983 in early New York hours, marking a drop of roughly 29% from its January peak near $5,608. The breach of the psychologically important $4,000 level — which had served as support since last November — intensified selling pressure, with technical analysts now eyeing the next major support zone around $3,800.usatoday+3

AI Frenzy Pulls Capital From Safe Havens

The selloff has coincided with a renewed surge in technology stocks driven by artificial intelligence. Micron Technology delivered a blowout quarterly forecast on Tuesday evening that sent its shares soaring and reignited enthusiasm across the semiconductor sector. The S&P 500 posted a 16% gain over April and May alone, led by semiconductor stocks, in a rally The Wall Street Journal News Corp compared to the dot-com era. Companies tied to AI infrastructure — including SanDisk Western Digital Corporation , Seagate , and Dell — have seen triple-digit gains this year.cnn+4

The capital rotation into risk assets has drained demand for gold, which thrives in uncertain environments but struggles to compete when equities offer outsized returns.

Iran Deal Unwinds War Premium

The other major headwind arrived on June 22, when the United States announced a 60-day waiver on Iranian oil sanctions following talks in Switzerland. The agreement, built on a memorandum of understanding signed June 17, includes Iranian commitments to allow IAEA inspectors and keep the Strait of Hormuz open to commercial shipping. Oil prices tumbled on the news, with Brent crude falling more than 3%.reuters+2

The de-escalation removed a risk premium that had supported gold since the U.S.-Israel-Iran conflict escalated in March. A post by President Trump on Truth Social clarifying terms of the framework agreement reportedly triggered the initial break below $4,000 on June 24.beincrypto

Long-Term Bull Case Intact

Despite the severity of the correction, several analysts maintain that gold's structural bull market remains in place. Goldman Sachs The Goldman Sachs Group, Inc. projected in May that central bank purchases would average 60 tons per month over 2026, providing a floor for prices. World Gold Council data showed central banks resumed net buying of 19 tons in April, led by Poland and China.bloomberg+1

"The broadly strategic nature of their purchases and continued confidence in gold's role as a store of value during periods of uncertainty" underpins long-term demand, the World Gold Council noted in its latest quarterly report. Swiss private bank UBP maintained a year-end target of $5,200 per ounce, framing the current decline as a sentiment-driven correction rather than a fundamental breakdown.ubp+1

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