Gold and Silver Prices Plummet as Oil Surges
Precious metals like gold and silver experienced a tumultuous week of trading as global events sent prices plummeting. The surge in oil prices, driven by escalating tensions in the Middle East, triggered a complex interplay of safe-haven demand and inflation-driven rate hike fears.
International spot gold fell 0.2% to $4,042.47 per ounce, while silver dropped 0.2% to $57.5 per ounce. On the Multi Commodity Exchange (MCX), gold futures settled over 2% lower at Rs 142,796 per 10 grams, and silver futures ended more than 3% down at Rs 219,250 per kg.
The sharp rally in global crude oil prices, led by Brent crude futures jumping 7%, was the primary catalyst for the volatile price action. The surge came after US President Donald Trump threatened 'major military punishment' for Iran and its Houthi allies following attacks on two Saudi oil tankers in the Red Sea.
Rate hike expectations strengthened, with markets pricing in more than an 80% probability of a rate hike at the September Federal Reserve meeting. The US dollar index climbed above the 101 mark, making gold more expensive for overseas buyers and weighing on bullion prices.