Gold slid below $4,000 per troy ounce on Tuesday, signalling its worst quarterly run in more than a decade. Prices fell to $3,943, the lowest since November, before a slight rebound. The drop follows a 14% decline over the last three months, after a January peak near $5,595 driven by retail speculation.

New US Federal Reserve chair Kevin Warsh signals a hawkish stance, raising expectations for rate hikes that hurt non‑yielding assets. Tom Price of Panmure Liberum notes that gold “pulls back” as investors pivot toward higher‑yielding Treasuries. The rally’s collapse coincides with Middle East tensions that once spurred oil‑driven inflation fears.

Outflows from gold‑backed ETFs and new restrictions by Chinese banks—ICBC and China Guangfa—add pressure. June is already the second month of net ETF withdrawals, as the World Gold Council records. Meanwhile, traders sell gold to fund AI stocks, chipmakers, and Space X’s record IPO, eroding demand.

Central banks could provide a floor, Nitesh Shah of Wisdom Tree suggests, but retail sentiment has shifted. With a stronger dollar, ETF outflows, and uncertainty over the Fed’s path, gold’s support base is eroding. The market now views gold as a less attractive hedge compared to interest‑bearing assets.