Gold tumbled on Thursday, with silver down more than 15%, weighed down by a stronger dollar and easing geopolitical tensions, after a brief rally failed in one of the steepest markets in decades.
Spot gold was down 2.9% at $4,816.75 an ounce as of 9:20 a.m. ET. U.S. gold futures for April delivery fell 2.3% to $4,839.10 an ounce.
Spot silver fell 15.5% to $74.40 an ounce after falling to $73.41 early in the session.
Precious metals prices have been volatile in recent trading, with gold and silver posting their steepest declines in decades after hitting record highs last Friday. Both metals widened their losses on Monday, but have rebounded modestly over the past two sessions.
“The sharp recovery in gold prices was simply a counter-trend move following an even bigger sell-off in the previous week,” said Fawad Razaqzada, market analyst at City Index and FOREX.com, adding that the decline likely changed market sentiment and created a new wave of selling.
The dollar rose to a two-week high, global stocks fell as geopolitical tensions eased, and falling commodity prices from oil to copper added to the broader market sell-off.
Russia and Ukraine agreed to a major prisoner swap after US-brokered talks, and President Donald Trump spoke by phone with Chinese President Xi Jinping, saying he was “very positive” despite tensions over Taiwan, while all eyes were on US-Iran talks scheduled for Friday in Oman.
“On the macro front, some of the key drivers that pushed gold relentlessly upward are starting to fade,” Razakzada said.
Meanwhile, JPMorgan said in a note that while a complete decoupling between gold and silver is unlikely, silver’s relatively rich valuations make silver valuations susceptible to a significant correction in the risk-off session, although it sees a near-term floor rising around $75-$80 and a recovery toward $90 next year.
Jeweler Pandora is moving to platinum-plated products to reduce its exposure to the volatility of the silver market.
Meanwhile, spot platinum fell 9.1% to $2,023.30 an ounce, and palladium fell 5.3% to $1,680.87.
(Reporting by Anmol Choubey and Noel John in Bangalore)
