$4,070 an ounce gave way on Monday as bullion slid as much as 1.2%, extending last week’s 1.4% loss after the US and Iran exchanged strikes over the weekend.
Higher energy prices drove the move, with the flare-up reviving expectations that central banks may need to raise interest rates again to contain inflation.
The Strait of Hormuz remained a key uncertainty after Iran said the waterway would be closed until further notice, a claim the US later denied.
US Central Command said American forces had begun attacks to ensure freedom of navigation, keeping focus on oil flows and inflation risks that can pressure non-yielding gold.