Gold and silver prices plunged on Monday as rising global bond yields dampened investor appetite for non-interest bearing assets such as precious metals. The sell-off sent major mining stocks lower in pre-market trading.
gold futures It fell 3.34% to $4,176.80. spot gold The price was $4,145.88 at around 5:40 a.m. ET, a 3.27% discount.
gold futures.
Meanwhile, silver fell further. silver futures It was last seen down 5.1% at $61.52 per ounce. spot silver It fell 4.92% to $61.11.
silver futures.
Silvercorp.
The downward move comes as investors continue to monitor inflationary pressures and the possibility of further interest rate hikes by the Federal Reserve as Treasury yields soar.
“Gold will face sustained pressure if higher interest rates contain inflation,” American Hartford Gold President Max Becker said in a note Friday. “Demand for gold as a diversification tool will remain even if inflation continues or economic stress increases.”
Interest rates are “only part of the gold story,” Becker added, noting that the world’s central banks purchased a record 289 tonnes in the second quarter, which he said he believed was a long-term reserve strategy separate from the Fed’s interest rate decisions.
