Gold and Silver Prices Plummet by Over $550 Billion as Bond Yields Rise

Gold and silver prices took a significant hit on September 28, plummeting by over $550 billion in just three hours. This massive decline was largely due to rising bond yields and increased rate-hike bets, which affected metals and Bitcoin's price.

Comex gold futures fell 2.11% to $4,197.40 an ounce, while silver dropped 3.59% to $62.47. Gold is now nearly 25% below its record high of $5,590 set earlier this year on January 28. The losses were so severe that the entire metals market lost around $550 billion in value.

The reason behind the decline was not due to geopolitical tensions, as might have been expected given the recent warnings from Iranian Foreign Minister Abbas Araghchi about a potential 'doomsday' war if attacked. Instead, the premium flowed into oil, causing Brent crude prices to rise 2.52% to $107 a barrel.

The increased inflation and rate expectations led to a higher U.S. Dollar Index of 101.39, a two-month high. This, in turn, raised the cost of holding gold due to its zero-interest-bearing nature.