Gold prices are set for a second consecutive weekly decline, despite a slight rise on Friday to $5,095.55 per ounce (spot). Surging energy prices due to the Middle East conflict have dampened expectations of near-term U.S. Federal Reserve rate cuts, limiting gold’s appeal as a safe-haven asset.

Since the war began on February 28, gold has dropped over 3%, as inflation concerns and uncertainty about Fed actions impact the market.

Traders expect the Fed to hold rates steady at 3.5-3.75% at the March 18 meeting. In India, gold demand remains subdued, pushing discounts to nearly a decade’s high, while safe-haven demand rises in China.

Overall, gold is likely to remain a focus for investors amid geopolitical instability and inflation uncertainty. Possible scenarios include rising gold demand if the conflict and energy prices escalate, or limited price gains if the situation stabilizes and Fed rates stay high.