Gold and silver prices plunged in a broad market selloff on Thursday as the dollar rose to a nearly two-week high and U.S.-China trade tensions showed signs of easing.
Spot gold was down 0.9% at $4,917.61 an ounce at 0754 GMT, retreating from a nearly one-week high earlier in trading. Prices had fallen by nearly 4% so far.
U.S. gold futures for April delivery fell 0.3% to $4,936.30 an ounce.
“(Kevin) Warsh’s appointment[as Federal Reserve Chairman]has breathed new life into the dollar, but traders are now more cautious about gold given the extreme volatility of late,” said Tim Waterer, chief trade analyst at KCM.
The dollar rose to a nearly two-week high on Thursday, making dollar-priced gold more expensive for holders of other currencies. On the geopolitical front, Iran and the United States agreed to hold talks in Oman on Friday, and President Donald Trump said he had a “very positive” meeting with President Xi Jinping on Wednesday. As global tensions eased, prices for commodities from oil to copper plummeted.
“With market liquidity thin, losses are feeding off each other, creating a self-reinforcing feedback loop, resulting in weak sentiment across most asset classes,” said Christopher Wong, strategist at OCBC.
Asian stocks fell as concerns about exploding costs for AI investments prompted rotation out of tech industries, while a fresh decline in silver weighed on leveraged positions that were already underwater.
Spot silver fell 9.3% to $79.88 an ounce after falling as much as 15% earlier. Last week, the precious metal hit an all-time high of $121.64.
“Industrial demand has disappeared at a high level and Chinese solar panel producers are looking for alternatives,” said Kunal Shah, head of research at Nirmal Van Commodities.
Spot platinum fell 8.7% to $2,125.80 an ounce after hitting an all-time high of $2,918.80 on January 26, while palladium fell 2.8% to $1,725.53.
