Gold futures dip below $4,100 as US war funding and Middle East tensions clash with rate fears
The U.S. House approved $95 billion in war aid while Houthi rebels targeted shipping lanes, creating a tug-of-war between safe-haven demand and inflation-driven rate expectations.
Gold August futures opened at $4,074.60 per troy ounce on Thursday, 23 July 2026, marking a 1.9% decline from Wednesday’s closing price. The contract recovered slightly by 8:08 a.m. ET, trading at $4,086.60 per troy ounce. The price action highlights a market tension between inflation concerns, which may prompt higher interest rates, and safe-haven demand driven by geopolitical instability in the Middle East.
The U.S. House of Representatives approved a $95 billion funding package on Wednesday, allocating resources for the Iran war, aid to farmers, and parts of the SAVE America Act. While the plan requires Senate approval, the vote signals continued U.S. support for military activity in the region, where the conflict is described as potentially being at an inflection point.
Simultaneously, Yemen’s Houthi rebels have targeted Saudi Arabian oil tankers in the Bab el-Mandeb Strait. This development raises fears of disruption to critical shipping lanes, adding to the uncertainty that supports gold prices despite the potential for higher interest rates, which typically exert downward pressure on the precious metal.
Gold’s year-over-year growth was recorded at 95.6% as of 29 January 2026, reflecting significant gains over the past year. The current price movement illustrates how investors are weighing the likelihood of broader geopolitical and economic instability against the potential for tighter monetary policy.
The approved funding plan still needs Senate approval, and it remains unclear whether the $95 billion package will pass. The specific impact of Houthi actions on global oil supply chains and gold prices remains contingent on the duration and severity of disruptions in the Bab el-Mandeb Strait.
