"What’s going on with safe-haven assets?" Gold betrays believers…slides despite a surge in oil prices

Drops below the $4,000 level in just a month

Gold keeps falling even amid a wartime backdrop

Gold ETFs also all in the red

Rate hold by the Fed dents investment appeal

Gold, a traditional safe-haven asset, has been sliding day after day. Normally, when geopolitical turmoil intensifies or oil prices surge, demand rushes into gold and prices rise. This time, however, expectations for a U.S. rate cut have been pushed back, reducing gold’s appeal versus yield-bearing assets such as bonds.

According to Investing.com on the 19th, gold futures (April 2026 contract) on the New York Mercantile Exchange settled at $4,839.15 per troy ounce the previous day, down 5.6% from a week earlier. It has been a month since gold futures, which had held the $5,000 line, fell back to the $4,000 level—since the 19th of last month.

On the same day, at the KRX Gold Market, the domestic gold price was trading at 232,030 won per gram, down 2.11% from the previous day. It marks a fifth consecutive session of declines.

Major gold-related exchange-traded funds (ETFs) are also posting negative returns. Among domestic gold ETFs, the largest by assets, ACE KRX Physical Gold, was at 32,290 won as of 2:45 p.m., down 4.8% from a week earlier. KODEX Gold Active (-4.8%), SOL International Gold (-4.8%), and TIGER Gold Futures (H) (-5.8%) also remained under pressure.

Typically, a sharp rise in oil prices stokes inflation and erodes currency value, supporting gains in gold and silver—leading real assets. But the U.S. Federal Reserve (Fed) has delayed rate cuts, weighing on investor sentiment. The Fed held its benchmark rate at 3.50–3.75% the previous day. Because gold does not pay interest, the longer a high-rate environment persists, the more investors tend to favor yield-bearing assets.

A strong-dollar trend is also exacerbating gold’s decline. Gold is priced in dollars; when the dollar rises, it increases purchase costs for overseas investors, dampening demand.

Still, institutions continue to build positions, expecting gold prices to rebound over the medium to long term—on the view that the Fed may move to cut rates or that a prolonged war would boost demand for safe-haven assets. According to ETFCheck, through the 18th institutional investors bought ACE KRX Physical Gold for 11 consecutive sessions. Net purchases totaled 86.245 billion won.

Reporter Lee Seon-a suna@hankyung.com