Defying the "safe-haven" rule, gold and silver prices plummeted on Monday despite escalating Iran-US tensions. Gold dropped 1.83% to around ₹76,000, while silver saw a steeper 2.11% decline, trading near ₹95,000 per kg.
The downturn stems from two main pressures:
The Fed Factor: Surging crude oil prices have fueled global inflation fears. To combat this, the US Federal Reserve maintains high interest rates, tightening liquidity and dampening investment demand for precious metals.
Liquidity Crunch: Sharp volatility in stock and commodity markets forced investors to liquidate gold holdings to cover losses and margin calls elsewhere.
While geopolitical strife usually drives prices up, the combination of aggressive monetary policy and a desperate dash for cash has momentarily stripped gold of its glitter, leaving both metals under significant trading pressure.