- Gold and other precious metals partially recovered after sharp early losses on Monday
- Spot gold fell over 5% early but rebounded to around $4,412 per ounce by late morning
- Silver hit a year-to-date low, down 5.9% to $63.76 amid ongoing volatility from Iran conflict
Gold and other precious metals staged a partial recovery on Monday after suffering sharp early losses, as markets reacted to US President Donald Trump's decision to postpone planned strikes on Iran's energy infrastructure following what he described as “good and productive” talks.
Spot gold plunged more than 5% in early trade to $4,262.50 an ounce before rebounding to around $4,412 by late morning in London. Despite the recovery, bullion remains under pressure, having fallen nearly 10% last week — its worst performance since September 2011, and about 25% from its late-January peak of $5,594.92 per ounce.
Gold futures mirrored the volatility, dropping almost 10% at one point before trimming losses to trade roughly 4% lower at $4,392.
Also Read: Markets To Rebound? GIFT Nifty Soars Nearly 900 Points As Trump Defers Iran Strikes, Holds Talks
Silver also extended its decline, with spot prices falling 5.9% to $63.76, marking a year-to-date low and nearly half of its February 28 level when the Iran conflict began. Silver futures were last down 8.3% at $63.98.
The sell-off spread across the precious metals complex, with platinum futures tumbling 9.7% to $1,780.20 and palladium slipping 4.7% to $1,377.50.
The sharp moves come amid heightened volatility linked to the Iran conflict, which has fueled inflation concerns and resultant expectations of higher interest rates, factors that typically weigh on non-yielding assets like gold. Rising bond yields, particularly in the euro zone, further reduced the appeal of precious metals.
“The stakes in the Iran war just escalated and what we're seeing is the ultimate flight to safety. This is exactly how crowded momentum trades come to an end,” Nic Puckrin, co-founder of Coin Bureau, told CNBC.
Puckrin added that central banks and Gulf states may be drawing down gold reserves accumulated in recent years. “The focus has moved from accumulation to capital preservation. This will put a natural cap on gold prices,” he added.
Also Read: Wall Street Set To Soar As Trump Hints At Iran Breakthrough; Dow Futures Jump 1,000 Points
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