Gold slid more than 8% to below $4,500 per ounce on Monday, extending losses from the prior session when the precious metal suffered its steepest fall in more than a decade. Friday’s rout was sparked by reports that US President Donald Trump plans to nominate Kevin Warsh, viewed as a more hawkish choice, to lead the Federal Reserve. Profit-taking also emerged after a relentless rally that had pushed gold to record highs. That advance was fueled by strong central bank demand and the so-called debasement trade, as investors rotated into physical assets from currencies and bonds amid concerns over surging government debt. Heightened geopolitical and economic uncertainty, along with worries about the Fed’s independence, reinforced gold’s safe-haven appeal. Momentum buying further amplified gains, with a wave of purchases from Chinese speculators adding froth to the rally and exacerbating the crash as they took profits.
Silver tumbled more than 10% to around $75 per ounce on Monday, nearly wiping out year-to-date gains and extending Friday’s 26% plunge which was its biggest one-day decline ever. The crash followed news that US President Donald Trump planned to nominate Kevin Warsh as the next Federal Reserve chair, widely viewed as the more hawkish option. Profit-taking also emerged after a relentless rally that had pushed silver to historic highs. That advance was driven by a structural deficit in the silver market and the so-called debasement trade, as investors rotated into physical assets from currencies and bonds amid concerns over rising government debt. Geopolitical and economic uncertainties, along with worries about the Fed’s independence, reinforced silver’s safe-haven appeal. Momentum buying further amplified gains, with a wave of purchases from Chinese speculators adding froth to the rally and intensifying the sell-off as sentiment reversed.
WTI crude oil futures fell more than 5% to below $62 per barrel on Monday, retreating from multi-month highs as traders monitor developments in US-Iran negotiations that could reduce the risk of supply disruptions. President Trump said on Saturday that Iran was “seriously talking” with the US, shortly after Iran indicated that arrangements for talks were progressing. This marked a shift from last month’s heightened tensions, when Trump repeatedly threatened military action over Iran’s crackdown on nationwide protests, while Tehran warned of retaliation. Those exchanges had helped drive oil prices sharply higher in January. Adding to signs of de-escalation, reports suggested that Iran’s Revolutionary Guards’ naval forces have no plans to conduct live-fire exercises in the Strait of Hormuz, a vital global oil route. Meanwhile, OPEC+ on Sunday reaffirmed its earlier decision to keep output unchanged in March, the final month of its three-month supply freeze.
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