Gold and Silver Prices Surge Amid Market Volatility
Precious metal markets experienced a sharp rebound on Tuesday, following a wave of heavy selling, with gold and silver prices rising by over 5% in a single session due to a confluence of factors impacting the market.
The spot price of gold increased by 5.01% to reach $4,893.35 per ounce, after hitting a low last month.
Prices had previously surged to a record high of $5,594.82 per ounce last Thursday.
Meanwhile, silver rose by 11.7% to $85.93 per ounce, following its historical peak of $121.64.
Market analysts attribute this rebound to the appointment of Kevin Warsh as the chairman of the U.S. Federal Reserve, which initially bolstered the dollar, and the CME Group's increase in margin requirements for precious metal futures, leading to sharp price fluctuations.
Kyle Roda, senior market analyst at Capital.com, stated:
"Current prices are nearing their fair value after weeks of irrational fluctuations, bringing gold and silver back to levels seen in mid-January."
It is noteworthy that gold recorded a remarkable gain of 13% in January, while silver rose by 19%, marking the largest monthly increase in years.
In contrast, the dollar has maintained its gains despite a partial U.S. government shutdown and the postponement of the January employment report, making dollar-denominated gold more expensive for international investors.
Other metals also experienced varied movements, with platinum rising by 0.6% to $2,134.10 per ounce, while palladium fell by 0.5% to settle at $1,711.
These movements come at a time when investors expect U.S. interest rates to decline at least twice by 2026, enhancing gold's appeal as a non-yielding safe haven amid new trade agreements between the U.S. and India aimed at reducing reciprocal tariffs.
Summary:
Gold is nearing $4,900 per ounce, and silver is experiencing a strong rebound following a price collapse, placing the market at the center of unprecedented fluctuations that may present significant opportunities for investors.
