Gold, Silver Prices Plummet on Rising Treasury Yields and Crude Oil

Gold and silver prices plunged sharply on September 28 due to a combination of factors. The Multi Commodity Exchange (MCX) saw gold futures decline by Rs 3,214 to Rs 1,47,667 per 10 grams, while silver futures fell by Rs 6,661 to Rs 2,28,035 per kg.

The sharp rise in US Treasury yields is one of the main reasons behind the precious-metal sell-off. The benchmark 10-year US Treasury yield has reached its highest level since 2007, making interest-bearing assets relatively more attractive and reducing demand for bullion.

Higher crude oil prices have also contributed to inflation concerns, supporting expectations of further US monetary tightening. Although geopolitical tensions can traditionally increase safe-haven demand for gold, a sustained rise in oil prices can simultaneously increase inflation expectations and bond yields, weighing on gold.