Gold dropped below $4,300 an ounce, while silver, platinum and palladium followed the downtrend as the precious metals complex pared all the gains made this year.

The precious metals complex, which witnessed a stupendous rally since 2024, has been heading south since the Iran war broke out on February 28.

Gold prices, which soared to a record high of $5,608 an ounce on January 29, has lost 24 per cent since then. On Tuesday, it was quoted at $4,270 an ounce at 2100 hours IST. 

Inflation at 3-year high

Analysts said gold prices dropped to levels seen in December last as investors focused on the US inflation report due on Wednesday. Fears are that inflation increased to 4.2 per cent, a three-year high driven by energy prices surging to near $100 a barrel. 

In addition, last week’s job report showed that 172,000 jobs were added in May, which could force the US Fed to increase interest rates. Since the Iran war broke out, fears of inflation, higher fossil fuel prices, rising bond yields and fears over global economic growth have dragged gold and other precious metals. 

“The US inflation data due on Wednesday will be crucial in shaping expectations around future Federal Reserve policy,” Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities. 

Gold has lost nearly 10 per cent month-on-month, while silver prices have plunged by 25 per cent. The white precious metal was quoted at $65.50 an ounce. Gold has now lost nearly a per cent this year, while silver’s loss for the year is 24 per cent.

Investors quit ETFs

The white precious metal soard to $121.62 an ounce on January 29. Platinum and palladium have also pared their gains and are currently down 16 per cent and 18.5 per cent, respectively, year-to-date.

Platinum was quoted at $1,719 an ounce and palladium at $1,235.50 an ounce.

The fall in gold prices has been accompanied by investors quitting physically-backed gold exchange-traded funds. Central banks, one of the primary sources behind the sparking rally of precious metals, have also cut down on their purchases, turning net sellers in March. 

From 2024 till January 29 this year, gold witnessed a rally on hopes of a rate cut by the US Fed, the US trade dispute with other countries and geopolitical crises.

Published on June 9, 2026