Gold and Silver Sink as 'Unhappy' Trump Spikes Oil and Bond Yields

GOLD PRICES sank on Tuesday, plunging to 4-week lows against a rising US Dollar as crude oil leapt again and global stock markets fell after President Trump said he is "unhappy" with Iran's latest peace talks proposal.

Bond prices also fell as gold and the other precious metals dropped, driving borrowing costs up to the highest in a month on 10-year US Treasurys and German Bunds, the highest since 2008 on UK Gilts above 5.0% per annum, and close to the highest since 1997 on Japanese government bonds.

"After eight weeks of energy shortages, there comes a time when physical supply starts to bite," says former HSBC macro fund manager and now head of independent analysts ByteTree Charlie Morris.

European contracts for global benchmark Brent crude rose more than 2.5% on Tuesday morning to top $112 per barrel for June settlement on the ICE derivatives exchange, marking the highest front-month price since summer 2022.

Futures on New York's S&P500 pointed to a lower opening after the leading US stock index set another new record close, its 6th of the past 2 weeks.

"In the near term, elevated geopolitical risks and tight physical market conditions are expected to continue underpinning oil prices...adding to global inflationary pressures, forcing central banks to keep interest rates higher for longer" and thereby pressuring gold prices, says a note from Chinese bank and London bullion clearers ICBC.

Consensus forecasts and betting on this week's slew of major central-bank rate decisions correctly saw "no change" from the Bank of Japan today, with "no change" predicted for the US Fed and Bank of Canada tomorrow or the European Central Bank and UK Bank of England on Thursday.

But the ECB and BoE are then expected to raise Euro and Sterling interest rates by half-a-per-cent before November.

Gold-backed exchange traded fund the SPDR Gold Trust (NYSEArca: GLD) yesterday saw shareholders liquidate stock for the 5th session in six, taking the giant gold ETF down 5.2% by size from the near 4-year record reached on 27 February, eve of the US and Israel starting their war on Iran.

Giant silver-backed ETF the iShares SLV was meantime unchanged in size Monday, also needing the least bullion to back its shares since November.

Japan's Nikkei 225 index today fell 1.0% from Monday's new all-time high, while the EuroStoxx 600 index cut its gains for the month of April to 4.6%.

"We are grateful for solidarity and welcome Russia's support for diplomacy," said Iran's Foreign Minister Abbas Araghchi overnight after meeting President Putin.

The United Arab Emirates today announced it will withdraw from both the Opec and Opec+ oil cartels on 1st May, calling it "long-term strategic and economic" decision.

Israel's military today ordered residents of a dozen towns in neighboring Lebanon to evacuate after Prime Minister Netanyahu ordered it to "vigorously attack" the Iran-backed Hezbollah group.