Gold Loses Its Safe Haven Shine as Prices Crash 24 Percent From Record Highs
A deepening selloff in tech stocks, expectations of more US rate hikes, and a surging dollar have pushed bullion to its lowest level in nearly two weeks.
Gold is proving that even the safest of havens can be vulnerable when markets get turbulent. Prices have now crashed by nearly a quarter from their record peak, and the selling shows no signs of letting up.
On Wednesday, spot gold slipped below 4,100 an ounce, hovering near its lowest level in almost two weeks. This follows a 1.7 percent drop in the previous session. From its all time high of 5,417 an ounce, the metal has now retreated roughly 24 percent.
Silver has taken an even bigger beating. The white metal has plunged about 47 percent from its January peak of 117 an ounce, making it one of the worst performing assets in the current downturn.
So what is driving this dramatic reversal? The answer is a complex mix of factors that have turned gold’s traditional strengths into weaknesses.
One of the most surprising triggers has been the technology sector. As AI driven stocks have tumbled from their record highs, investors facing heavy losses have been forced to sell gold to raise cash. This liquidation of bullion holdings has amplified downward pressure on prices.
At the same time, expectations of tighter monetary policy in the United States have strengthened the dollar. The Bloomberg Dollar Spot Index has been climbing since the Federal Reserve’s latest meeting. A stronger dollar makes gold more expensive for international buyers and typically weighs on demand.
Traders are now pricing in as many as three interest rate hikes this year. Those expectations have been reinforced by the Fed’s growing concern over inflation and a notably hawkish stance from new Chair Kevin Warsh. Higher rates reduce gold’s appeal because the metal generates no income. When yields on other assets rise, investors tend to shift away.
The next major test will come from the US Personal Consumption Expenditures index, the Fed’s preferred inflation gauge, due later this week. A stronger than expected reading could solidify expectations of additional rate increases.
Even geopolitical uncertainty is no longer providing support. President Donald Trump claimed on Tuesday that Iran had agreed to indefinite nuclear inspections, but Tehran quickly disputed that statement. Ordinarily, such friction would push investors toward safe havens. However, analysts say monetary policy concerns are now completely outweighing geopolitical risks.
This marks a stunning turnaround after an extraordinary rally. Gold rose more than 65 percent in 2025, following a 28 percent gain in 2024. Silver surged 148 percent last year. The current correction puts gold on track for its steepest quarterly decline since December 2016.
For now, the trend remains weak. Investors are watching for any signs of softer inflation that could revive hopes of policy easing. But unless the Fed signals a shift, gold may remain under pressure despite global tensions.
📎 Source
Source: TradingView report citing Moneycontrol, Reuters, and CME FedWatch data, June 24, 2026