Gold, Industrial Metals Tumble Amid Middle East Tensions
Brent crude breached $80 per barrel for the first time since January 2025, propelled by the joint US-Israeli military strikes on Iran. The sudden energy shock stoked fresh global inflation fears, driving investors toward safe-haven liquidity and pushing the US Dollar Index to 99.4 — hovering near its highest level in 14 weeks.
With the dollar strengthening and bond yields climbing, the Federal Reserve is widely expected to hold interest rates steady at its upcoming meeting, heaping further pressure on commodity valuations.
Gold bore the brunt of the initial sell-off, plunging 5.1% to $4,996.5 per ounce, while silver collapsed 16.8% to $78 — exposing deep fault lines in market stability. Industrial metals suffered in tandem as risk appetite evaporated: platinum shed 14.9% to $2,013 per ounce, palladium fell 10.5% to $1,601.6, and copper retreated 5.2% to $5.7 per pound.
Markets partially recovered by Wednesday's session, with gold rebounding to $5,160, silver climbing back to $84.80, platinum recovering to $2,148, and palladium advancing to $1,689.
Escalating Trade Costs Compound the Shock
Futures and commodity markets analyst Zafer Ergezen told Anadolu that the selloffs reflected concerns running far deeper than price volatility alone, warning that threats to the Strait of Hormuz had already begun distorting global shipping routes and inflating freight and insurance costs as vessels diverted around the Cape of Good Hope.
"Routes are changing, ships are having to wait — all this means that global trade is facing the risk of increased costs, not only due to oil and natural gas, but also in general terms," Ergezen said.
He warned that rising trade costs would compound inflationary pressures already being amplified by surging energy prices — with knock-on effects for central bank policy worldwide.
"Central banks around the world are expected to postpone their rate cut cycles and skip rate decisions at their first meetings," he said. "Markets increasingly expect no rate cuts."
Ergezen also noted a clear divergence in how metals were responding to the turmoil. "We are seeing a rise in the sales of metals and commodities widely used in the industrial sectors, and in general, we see deeper sales in industrial metals, while precious metals had reached new peaks this year," he added.
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
