Bullion prices gained as much as 3.1% in Asia trading to reclaim the mark of $4,850 an ounce, while Silver prices surged as much as 4.5% to near the $77 an ounce mark. Prices were higher on Tuesday as well.
The announcement made by US President Donald Trump on his Truth Social has sent risk assets soaring, including the equity markets, while oil prices have plunged in double-digits this morning.
Gold and Silver are generally considered to be haven assets, finding favour among investors during times of uncertainties and market underperformance.
However, prices had seen a plunge during the Iran war with both metals losing their so-called “haven appeal.” Gold prices fell as much as 15% from their record high levels, while Silver also fell more than 50% from their recent peak, which was close to $120 an ounce.
The fall in Gold and Silver was due to the surging oil prices, which stoked inflation fears and lowered growth forecasts across global economies. Higher inflation fears lowered probabilities of central banks easing interest rates further in 2026.
Traders are now factoring in rate hikes from both the European Central Bank and the Bank of England, while the probability of the US Federal Reserve cutting interest rates also dwindled.
Higher interest rates are generally negative for both Gold and Silver as they are non-interest yielding instruments, therefore, triggering the sharp sell-off in both of them through March.
Gold prices are currently trading around the mark of $4,800, while Silver is now trading 4.5% higher at $76.2.
