Recent strength in U.S. economic data, including May nonfarm payrolls exceeding expectations and May CPI rising to 4.2% amid energy price spikes tied to Iran-related supply disruptions, has lifted expectations for a more hawkish Federal Reserve stance and reduced prospects for near-term rate cuts. This dynamic, combined with a firmer U.S. dollar and higher Treasury yields, has weighed on gold prices, which recently settled near $4,090 for the front-month contract after pulling back from earlier 2026 peaks above $5,500. Persistent central bank purchases continue to provide underlying support, keeping trader-implied probabilities concentrated in the $3,800–$4,600 range for June settlement as markets weigh these crosscurrents ahead of the contract's expiration.