New york: Gold prices fell at the start of Asian trading on Monday as the war between the United States, Israel, and Iran escalated rapidly, triggering significant flows into oil and the dollar. However, bullion prices remained above $5,000 an ounce, holding steady at a relatively comfortable level as increased safe-haven demand in the wake of the conflict continued to fuel flows into gold.

According to National Iraqi News Agency, spot gold fell 2% to $5,064.71 an ounce early Monday, while gold futures dropped 1.6% to $5,073.21 an ounce. While the precious metal benefited from increased safe-haven demand following the start of the US-Israeli conflict with Iran, its gains were tempered by concerns that the inflationary effects of the war could lead to a more hawkish stance from major global central banks.

This has seen the dollar outperform gold over the past week, while oil prices have outperformed other commodity markets as the war with Iran has signaled increased supply disruptions in crude oil markets. Both the dollar and oil prices rose on Monday after US and Israeli strikes on Iranian oil facilities raised the prospect of a potential escalation in the conflict. The dollar index jumped 0.6%, while Brent crude surged as much as 20%, surpassing $100 a barrel.

Gold fell nearly 2% last week, continuing to fluctuate between $5,000 an ounce and a near-record high of $5,600 an ounce reached in late January. The metal has since experienced significant volatility amid increased speculative activity and growing uncertainty about the path of interest rates. Other precious metals also generally declined on Monday. Spot silver fell 2.5% to $82.1227 an ounce, while spot platinum slipped 4.2% to $2,050.29 an ounce.