Gold and Silver Prices Drop Sharply Amid Middle East Tensions

Gold and silver prices fell sharply on Monday, with spot gold dropping 5.8% to $4,226 per ounce, marking its ninth consecutive session of losses and the largest weekly decline since 1983.

Prices fluctuated between $4,160 and $4,536 during the day, slipping roughly 6% from Friday’s close and falling below $4,300 for the first time since December 2025. U.S. April gold futures mirrored the decline, falling 7.5% to around $4,231. Last week, gold lost over 10% in value, reaching the lowest level of 2026.

Other precious metals also posted steep declines. Silver dropped 8.9% to $61.76 per ounce, platinum fell 9% to $1,749 and palladium decreased 5.2% to $1,330.

Analysts attributed the drops to escalating Middle East tensions, including pressure on Iran, which have driven oil prices to $100–$110 per barrel. These factors have heightened inflation concerns and raised expectations of higher global interest rates. Gold, as a non-yielding safe-haven asset, has lost appeal amid rising returns elsewhere, prompting investors to sell holdings to offset losses in other areas.

Potential disruptions in energy supply, including threats to the Strait of Hormuz, have added to pressures on inflation and production costs. Financial markets reacted negatively, with Asian stock indices falling and the U.S. dollar strengthening. Market data indicate the Federal Reserve is more likely to raise interest rates than cut them before the end of 2026.

The combination of geopolitical risks, surging energy prices and shifting monetary policies is exerting significant downward pressure on gold and other precious metals, creating short-term uncertainty for investors.