Gold and Silver Prices Plunge Amid Rising Oil Costs and Higher Interest Rates
Gold and silver prices have been falling globally due to several factors, including rising crude oil prices, higher US Treasury yields, and a stronger dollar. The price of gold has dropped by about 4% in recent days, with spot gold reaching its lowest level since August 5 at $4,110.55 an ounce. Silver has also fallen, dropping 4.5% on Monday to $61.39 an ounce.
The increasing cost of oil is contributing to inflationary pressures and strengthening expectations that central banks will keep interest rates elevated or raise them further. This, in turn, puts pressure on gold and other precious metals. Gold does not pay interest, making it less attractive to investors when bond yields rise.
Investors are now awaiting a series of US economic indicators this week for fresh clues on the Federal Reserve's next move. The figures could shape expectations about the path of US interest rates, which remain a key driver of gold and silver prices.