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Gold Falls Below $4,200, Silver Drops Over 3%
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International precious metals prices experienced a sharp decline on September 28, with London gold spot falling over 2% to below $4,200 per ounce, and London silver spot dropping 3.5% to below $62 per ounce for the first time since August 7. The sell-off was triggered by geopolitical developments: U.S. President Donald Trump stated on September 27 that he expects to continue negotiations with Iran this week, though he rejected Iran's proposed end-of-war plan, saying Iran 'overestimated its bargaining chips' and that he is 'always considering' military action. Indirect talks between the U.S. and Iran may begin as early as September 28, mediated by Qatar and others, but major differences remain—Iran wants to focus on navigation in the Strait of Hormuz and lifting maritime blockades, while the Trump administration demands nuclear concessions. Iran's Foreign Minister Araghchi said Iran is prepared for war but open to diplomacy. Analysts at Huatai Futures attribute the price drop to macro headwinds, including stronger-than-expected U.S. PMI data raising expectations of further interest rate hikes, and rising U.S. Treasury yields. Guolian Futures forecasts that precious metals will remain in a volatile, weak pattern as long as high-rate expectations persist, with London gold trading in a $4,200–$4,400 range, though geopolitical shocks could cause temporary rebounds.
Source report
By China Fund News Reporter Li Zhi
On September 28, international precious metals prices experienced a sharp decline. Spot gold (London Gold) fell below $4,200 per ounce, dropping more than 2%. Spot silver (London Silver) briefly lost the $62 per ounce mark for the first time since August 7, and was last trading down 3.50%.
Background: U.S.-Iran Tensions and Nuclear Talks
According to CCTV News, U.S. President Donald Trump stated in an interview on September 27 that he expects to continue negotiations with Iran this week. The day prior, Trump had rejected Iran's proposal to end the war.
Trump said Iran wants a deal, but "not the deal I want," adding that Iran "overestimates its leverage." When asked whether he is considering resuming military strikes against Iran, Trump replied, "I'm always considering it."
Separately, local sources reported that the U.S. and Iran could hold a new round of indirect talks as early as September 28. Mediators including Qatar are working to facilitate dialogue, but significant differences remain on key issues. Iran wants negotiations to focus on navigation through the Strait of Hormuz and the lifting of U.S. maritime blockades, while the Trump administration demands that Iran agree to concessions on its nuclear program.
On September 27, Iranian Foreign Minister Abbas Araghchi stated that Iran is fully prepared for a resumption of war with the U.S., but has not given up on diplomatic engagement. "We are fully prepared for the resumption of war, and at the same time, we are ready for diplomatic contact. It depends on the choice of U.S. President Donald Trump," Araghchi said in an interview.
Market Outlook: Precious Metals Under Pressure
Huatai Futures noted that short-term precious metals prices are constrained by negative external macroeconomic factors. Stronger-than-expected U.S. PMI data released this week has raised market expectations for further interest rate hikes within the year, putting short-term pressure on precious metals. Additionally, the U.S. Treasury's long-term bond buyback scale again fell short of expectations and landed at the bottom of the disclosed range, causing U.S. bond yields to continue rising.
Looking ahead, Guolian Futures believes that precious metals remain in a tug-of-war between high-interest-rate pricing and geopolitical supply risks. As long as U.S. bond yields and rate hike expectations remain strong, the pattern of volatile and weak precious metals prices is unlikely to see a fundamental reversal. Technically, the trading range is expected to be between $4,200 and $4,400 per ounce for spot gold. If macroeconomic factors cause a breakout of this key range, further room for movement could open up. However, it should be noted that due to changes in the Middle East situation, oil price volatility has increased significantly, and precious metals prices are also experiencing greater fluctuations. Even if an escalation of geopolitical conflict triggers a pulse-like rebound, such moves are more likely to be seen as corrective rebounds before high-interest-rate expectations ease significantly.
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Source
中国基金报Eastern
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Gold plunges below $4,200, silver drops 3.5% as Trump signals Iran talks, rate hike bets rise