Gold (GC=F) fell to around $5,300 an ounce after briefly topping $5,600 on Thursday, while silver (SI=F) also pared gains as the precious metal took a breather from a strong rally.
The decline coincided with a sell-off in the stock market, with the Nasdaq Composite Index (^IXIC) falling 2% as shares of Microsoft (MSFT) tumbled. The tech giant’s quarterly earnings report spooked investors amid higher-than-expected capital spending and slower quarterly cloud sales growth.
The precious metal’s meteoric rise that has stunned Wall Street faced headwinds on Thursday as the dollar (DX-Y.NYB) rebounded from its lowest levels since early 2022.
“I think the continued surge in metals, especially gold and silver, is entering a dangerous phase,” Ole Hansen, head of commodity strategy at Saxo Bank, said on Thursday.
“The problem is volatility itself. As price volatility increases, liquidity decreases,” he added.
Gold prices have risen about 20% so far this year as the U.S. dollar weakens against other currencies.
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Just last week, Goldman Sachs analysts set a year-end price target for gold of $5,400, with potential upside risks due to increased participation from private sector investors.
Precious metal prices rose above $5,500 on Wednesday after the Federal Reserve kept interest rates steady, with comments from Fed Chairman Jerome Powell failing to stem the dollar’s slide.
“I think this indicates a high level of conviction in the dollar decline trade,” Brookings Institution senior fellow Robin Brooks wrote in a note before gold prices fell on Thursday. “A weaker dollar is exacerbating depreciating trade,” he noted.
Silver prices topped $120 an ounce before giving up gains. The precious metal is up 42% so far this year after a stunning rally in 2025.
JPMorgan analysts noted earlier this month that “silver prices have moved well beyond our average forecast, although calling it a peak is nearly impossible when the market is showing near-parabolic price momentum.”
Ines Ferre is a senior business reporter at Yahoo Finance. Follow her on X: @ines_ferre.
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