Precious Metals Plummet Amid Cross-Market Sell-Off and Dollar Surge

Gold and silver prices took a sharp dive as markets sold off, influenced by a strengthening dollar and easing U.S.-China trade tensions. Spot gold dropped 1.7%, while silver fell by 12.4%. Analysts cite a lack of industrial demand and warn of volatility. Meanwhile, geopolitical talks loom.

Prices of gold and silver fell sharply on Thursday as markets experienced a broader sell-off. Contributing to the downward trend was a strengthening U.S. dollar, reaching a near two-week high, alongside cooling trade tensions between the U.S. and China, resulting in increased pressure on precious metals.

Spot gold declined by 1.7% and was valued at $4,876.12 per ounce, retreating from a near one-week high earlier. U.S. gold futures for April delivery also slipped by 1.1%, priced at $4,896.30 per ounce. Tim Waterer, KCM's chief trade analyst, noted the emergence of the dollar's resurgence following the Warsh nomination.

As the dollar rose, it made dollar-priced gold more costly for holders of other currencies. Christopher Wong from OCBC attributed the soggy sentiment across precious metals, cryptocurrencies, and equities to a self-reinforcing feedback loop amid low market liquidity. Silver plunged by 12.4% to $77.09, with declining industrial demand, while geopolitical discussions continue between Iran and the U.S.