Is Gold Still a Safe Haven in Times of War?

🌅 Morning News Nuggets | Today’s top stories for gold and silver investors
March 26^th, 2026 | Brandon Sauerwein, Editor

Gold is down 15% since the Iran war began — and investors are asking whether gold is still a safe haven at all.

Why Are Gold and Silver Falling During a War?

Gold and silver have had a harsh month, and Thursday continued the slide. Spot gold fell over 1% to about $4,450, while silver dropped nearly 5% to roughly $68.00.

Both metals are being pressured from multiple angles. Ceasefire talks remain uncertain. The Federal Reserve’s stance has shifted toward hawkishness, and markets have effectively priced out any rate cuts this year — a sharp reversal from earlier expectations of multiple cuts. A stronger dollar and rising Treasury yields are adding further strain on non-yielding precious metals.

Silver is being hit harder than gold because it serves as both an investment metal and an industrial commodity. When growth looks threatened, silver faces selling from both investors and industrial users. That dual role helps explain why silver’s monthly losses exceed gold’s, which itself appears headed for its worst monthly drop since October 2008.

Those price moves are dramatic, but they don’t tell the whole story. A more important question is why the assets investors look to in crises — gold and defense stocks — lost momentum when the shooting began.

Why Did the Crisis Trades Stop Working?

At first, the market behaved as expected: U.S. and Israeli strikes pushed gold toward $5,400 and silver near $97. That surge lasted about a week. Afterward both metals collapsed, with the Fed’s March 18 policy signal marking the turning point. The updated dot plot suggested fewer cuts in 2026, and higher Treasury yields raised the opportunity cost of holding non-yielding gold, prompting accelerated selling.

Defense stocks mirrored that arc. They rallied on conflict fears and then retreated as ceasefire hopes gained traction. The geopolitical premium that briefly lifted those names faded quickly. The episode underscores that “safe haven” is a relative, not absolute, designation — one that is sensitive to interest rates and yield dynamics. When energy-driven inflation keeps the Fed on a firm path, even assets historically prized in crises can lose appeal.

Rather than acting solely as a panic hedge, gold is increasingly behaving like a store of value that investors and institutions can tap into; Bloomberg’s Marcus Ashworth calls it a “piggy bank.”

Is Gold Still a Safe Haven — or Just a Piggy Bank?

Bloomberg Opinion columnist Marcus Ashworth frames the recent move as evidence that gold is acting more like a piggy bank than an instant crisis hedge. A 15% fall since the Iran conflict began is notable, but it follows a large prior run-up. Assets that have delivered large gains become tempting sources of profit-taking when volatility spikes. Gold remains up more than 50% over the past year, suggesting the recent decline reflects selling into strength rather than panic.

There’s also a structural shift underway. Central banks were major purchasers of gold over recent years; with rising energy and defense costs, some institutions may now look to those reserves to help finance expenditures. That changes gold’s role: from solely a portfolio hedge to a balance-sheet asset that nations can deploy. The metal isn’t broken — it’s being repurposed — and that dynamic may persist while fiscal and energy pressures remain.

How Long Can the Global Economy Absorb a Closed Strait of Hormuz?

The Strait of Hormuz has been effectively closed for nearly a month, and corporate leaders warn the tolerance window is limited. Energy strategist John Kilduff told CFOs that the timeframe is measured in weeks rather than months: if the strait remains blocked, oil prices would reprice sharply, Asia could face energy shortages, industrial activity would slow, and a persistent risk premium could be built into oil for the long term.

Economists and banks are already factoring in meaningful cost and growth consequences. Some models show that a brief but large spike in oil could push major economies into contraction, and recession odds for the U.S. have been rising. Yet there’s an important feedback loop: if growth weakens enough, the Fed may be forced to pivot from tightening to easing, which would be a catalyst for gold to regain structural support.

$40 or $150: BlackRock’s Larry Fink Says There’s No In-Between on Oil

BlackRock CEO Larry Fink laid out a stark two-way scenario: either Iran’s re-entry to global markets restores supply and oil drifts back toward $40 per barrel, or a sustained threat to shipping keeps oil above $100 and possibly pushes it toward $150 for an extended period. In the latter case, Fink warned, global recession becomes likely. He also highlighted the regressive impact of prolonged high energy costs, which weigh most heavily on lower-income households.

For gold, those outcomes cut both ways. Prolonged high oil and persistent inflation would keep the Fed hawkish and the dollar strong — headwinds for precious metals. But a deep growth shock that forces the Fed to reverse course would strengthen gold’s case as a policy-insensitive store of value. That scenario is where gold’s long-term narrative could reassert itself most quickly.

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