Gold Retreats Before US Inflation Test; Oil Climbs

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On May 12, 2026, gold prices slipped as investors monitored Middle East tensions and prepared for crucial U.S. inflation data that could reshape interest rate expectations. The decline followed a sharp rally that pushed gold to a three-week high earlier in the session.

Gold Loses Shine as Inflation Fears Return

Gold prices edged lower on Thursday, reversing earlier gains as traders reassessed geopolitical risks and rising inflation concerns ahead of the latest U.S. Consumer Price Index report. Spot gold dropped 0.6% to $4,705.99 per ounce by 0603 GMT, while U.S. gold futures for June delivery eased 0.3% to $4,714.50.

The precious metal initially climbed on safe-haven demand, yet momentum weakened as hopes for easing tensions in the Middle East faded.

Higher Rates Cast Shadow Over Gold

Expectations for interest rate cuts this year also softened after major financial institutions revised forecasts due to persistent inflation and stronger labor conditions. Rising oil prices strengthened the dollar, adding further pressure on gold prices and other metals. Silver fell 1.3%, platinum lost 2.3%, and palladium declined 1.8%.