Central bank reserve sales weigh – Gold eyes fourth weekly drop

• Bloomberg reports that Turkey’s central bank sold and swapped about 60 tonnes of gold—worth over $8 billion—across two weeks after the Iran war began.
• Carsten Menke of Julius Baer says Poland may also consider selling. He warns involuntary sales are more worrying than voluntary rebalancing because they lack control, and he expects short-term volatility to stay elevated.
• Gold climbed in early trading after President Trump delayed strikes on Iran’s energy sector for another 10 days but stayed on course for a weekly loss as rising energy costs stoke inflation and rate-hike worries.
• Since the war started, oil has jumped, sparking inflation fears that normally boost gold as a hedge; yet rising interest rates usually pressure non-yielding bullion.
• Traders have ruled out U.S. rate cuts in 2026 and assign about a 40% chance of a year‑end rate hike, according to CME Group’s FedWatch Tool; before the war, markets had been pricing in two cuts.

Investors again sought the safety of the U.S. dollar. The dollar index, tracking the greenback against six peers, was last up 0.27% at 100.13.

Gold climbed Friday on bargain hunting but was set for a fourth consecutive weekly decline, as the U.S.-Israel war with Iran raised inflation fears, strengthened the dollar, and bolstered bets on higher interest rates.

Spot gold gained 1.26% to $4,433.46/oz at 12:17 pm GMT, bouncing back from a near four -month low recorded Monday.

Gold is viewed as an inflation hedge, but higher interest rates boost yield-bearing assets, and a firmer dollar makes bullion more expensive for holders of other currencies.

CME FedWatch:

Current target rate = 3.50 - 3.75.

• CME FedWatch April no rate change probabilities have moved higher to 93.8% now from 75.4% on February 27, 2026.

Fed rate probability

As of March 20, 2026

As of today

• CME FedWatch latest Fed rate probability points at no rate cut until mid-2027. What a change!!!
• Another interesting observation is that now Interest Rate Futures market expects a rate hike between September ’26 to September ’27, which was not the case on March 20, 2026.

Technical analysis perspective

Gold/US Dollar

• Spot gold plunged to 4 months low Monday to record $4,099 followed by a relief to neutralize the oversold technical models.
• Prices hovering in a triangle like formation suggesting a counter trend rise to $4,285 to $4,495.
• Such corrective will be followed by another sharp sell-off to $4,250 - $4,240.
• Overall trend is bearish based on 25 years of seasonality; Gold remains in a range or weak during the month of March until the 1^st week of April.

Gold four-hourly chart

Gold/Silver ratio

• The gold–silver ratio shows how many ounces of silver buy one ounce of gold (gold ÷ silver), a key measure of relative value.
• The ratio is trading in a 56–69 range, inside February monthly range implying range-bound action for both metals after a huge sell-off this week.
• A rising ratio typically signals relative weakness in both metals.

Gold/Silver ratio monthly chart

Gold/Silver ratio vs US interest rate monthly chart

• US interest rates and the gold–silver ratio move inversely.
• Falling rates tend to push the ratio higher.
• Rising rates tend to push the ratio lower.
• Stable rates usually produce a range-bound ratio.

Gold Feb – April price action seasonality monthly chart

• Since 2006, gold has typically weakened from February through April each year, except in 2011, 2024 and 2025.
• This March saw a large sell-off, suggesting further weakness in April 2026.
• The blue-shaded region in the chart represents February through April for each year from 2006 to 2026.
• We will monitor how this observation and research plays out.