Precious metals decline as silver plunges over 3%

Precious metals came under pressure Tuesday, with gold falling more than 1% as expectations of higher-for-longer US interest rates depressed demand for non-yielding assets.

Spot gold dropped more than 0.6% to $4,290 per ounce as of 1450GMT, extending recent losses as investors assessed stronger US macroeconomic data, rising rate expectations, and easing safe-haven demand.

Silver also weakened, falling 3.5% to around $65.50 per ounce in recent market trading, as the broader precious metals complex remained exposed to pressure from higher Treasury yields and a firmer rate outlook.

Gold, which does not offer interest income, typically comes under pressure when investors expect borrowing costs to stay elevated or rise further. CME FedWatch data is used by markets to track probabilities of Fed rate moves implied by 30-day Fed funds futures.

The latest move came after gold recently broke below key technical levels, while traders turned their focus to upcoming US inflation data for clues on the Federal Reserve’s policy path. Among other precious metals, silver had earlier seen intermittent gains but remained vulnerable to the same rate and dollar dynamics weighing on bullion.

Safe-haven demand also eased as investors monitored a tentative pause in Mideast hostilities, which reduced some immediate geopolitical risk premium across commodities, including oil and precious metals. Crude prices also fell on Tuesday as markets assessed the pause in Israel-Iran attacks.

Despite the daily decline, gold remains at historically elevated levels after strong gains earlier in the year, supported by geopolitical uncertainty, central bank demand, and inflation concerns. Silver, meanwhile, continues to trade with a dual profile as both a precious metal and an industrial input, making it sensitive to shifts in risk appetite, manufacturing expectations, and monetary policy.