Gold prices fell in Asian trade on Thursday and were close to breaking below key levels as waning safe haven demand and the prospect of higher-for-longer U.S. interest rates battered the yellow metal.

Bullion prices were nursing a sharp drop from record highs over the past week, as a potential conflict between Iran and Israel did not escalate as markets were fearing. This largely dented safe haven demand for the yellow metal.

Oil prices fell to weekly loss despite settling higher in volatile trade Friday as investors cooled bets on a wider Middle East conflict after Isreal launched measured attacks on Iran and the latter signaled little appetite to escalated the tit-for-tat skirmish. 

At 14:30 ET (18:30 GMT), West Texas Intermediate crude futures rose 0.5% to $83.14 a barrel, while Brent oil futures rose 0.3% to $87.33 a barrel. Both contracts ended the week about 3% lower as a stronger dollar on expectations for higher for longer U.S. interest rates weighed. 

The U.S. dollar handed back early gains Wednesday in volatile action, as traders digested the reported Israeli strikes against Iranian sites and the impact on risk appetite.

At 05:25 ET (09:25 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% lower at 105.870, having earlier climbed as high as 106.190, just marginally below the five-month peak of 106.51 seen earlier in the week. 

Gold prices surged in Asian trade on Friday, coming close to record highs after reports of Israeli strikes on Iran ramped up demand for safe havens, especially in the face of worsening conditions in the Middle East. 

Spot gold rose as high as $2,417.79 an ounce, while gold futures expiring in June rose as far as $2,433.0 an ounce. Spot prices were just below record highs of $2,430.96 an ounce hit last week. 

Recent days have witnessed a shift in sentiment toward the Bitcoin ETF sector, with data revealing a temporary downturn in flows. According to recent data from a notable analytics firm, Bitcoin spot ETFs experienced a net outflow of $165 million yesterday. Notably, Grayscale ETF GBTC reported a net outflow of $133 million, while BlackRock (NYSE:BLK) ETF IBIT saw a net inflow of approximately $18.09 million.

Despite this apparent cooling off, Eric Balchunas, a senior ETF expert at Bloomberg, has offered insights that challenge any premature conclusions about the demise of the Bitcoin ETF fervor. Balchunas suggests that such fluctuations are part of a natural ebb and flow within the ETF market, particularly following a period of rapid growth.

Oil prices held near a three-week low on Thursday as investors weighed mixed U.S. economic data, U.S. sanctions on Venezuela and Iran and easing tensions in the Middle East.

Brent futures fell 18 cents, or 0.2%, to settle at $87.11 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 4 cents, or 0.1%, to settle at $82.73.

Gold prices rose in Asian trade on Monday and were in sight of record highs as demand for safe havens was boosted by Iran’s attack on Israel, although strength in the dollar limited major gains in the yellow metal.

Markets were also waiting to see just how Israel would respond to Iran’s strike, given that the attack caused limited damage, and that Tehran also said the move concluded its offensive against Israel. This helped limit some safe haven demand.

The dollar reached its highest since early November against a basket of currencies on Monday and sent the yen to its lowest level since 1990, after U.S. retail sales increased more than expected in March.

Retail sales rose 0.7% last month and data for February was revised higher to show sales rebounding 0.9% instead 0.6% as previously reported. Economists polled by Reuters had forecast retail sales, which are mostly goods and are not adjusted for inflation, rising 0.3% in March.