Gold prices tumbled more than 5% to around $4,130 per ounce on Tuesday, marking their biggest one-day fall since August 2020, as investors locked in profits after months of record-breaking gains. The slide came just a day after gold hit a new all-time high of $4,382 per ounce.
The sell-off was driven by profit-taking, a stronger U.S. dollar, and waning safe-haven demand amid growing optimism about global trade. Markets cheered signs of progress ahead of next week’s Trump–Xi summit, where both leaders are expected to discuss tariff disputes and measures to stabilize trade relations.
The end of India’s seasonal gold-buying spree also weighed on physical demand, while expectations of a U.S. government shutdown resolution and upcoming inflation data further pressured prices.
Despite the pullback, gold remains up more than 60% year-to-date, fueled by Federal Reserve rate-cut expectations and persistent global economic uncertainty.
Gold miners bore the brunt of the sell-off. Newmont Corp. plunged 8.8%, making it the worst performer in the S&P 500, while the SPDR S&P Metals & Mining ETF slipped nearly 5%. Analysts said the volatility signals a market “entering an unsustainable advance,” as the metal increasingly trades like a high-growth stock rather than a defensive asset.
Silver mirrored the slide, falling over 5% to $48.62 per ounce, as investors questioned whether the precious metals rally had run too far, too fast.
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