Gold and silver extend sharp declines in Monday trading

Precious metals markets opened the week with steep losses as a major sell-off in gold and silver extended into Monday's trading session. The price of gold per ounce stood at approximately $4,535.8, reflecting a decline of around 6.7% from the previous close. This followed a dramatic drop of roughly 11% on Friday, marking a stark reversal after a 10-week upward trend that had seen gold surge nearly 66% over the past 12 months.

A dramatic correction for silver

Silver experienced an even more pronounced correction, plummeting by about 11.7% to trade near $74.8 per ounce. This represents a significant pullback for the metal, which had seen an extraordinary 139% surge over the last year. The rapid decline underscores the volatile nature of the recent bull run in precious metals, where both gold and silver had reached what many analysts considered overbought levels, leading to profit-taking and a market reassessment.

Monetary policy and a key Fed nomination

The reversal in metals coincides with shifting dynamics in US monetary policy and leadership. The Federal Reserve's decision last Wednesday to hold interest rates steady contributed to a recovery in the US dollar from recent lows, increasing the opportunity cost of holding non-yielding assets like gold. More significantly, President Donald Trump's Friday announcement nominating former Fed Governor Kevin Warsh as the next chair of the central bank reduced a major source of market uncertainty. Warsh is perceived as a more hawkish figure likely to favor tighter monetary control, a prospect that bolstered the dollar and triggered the initial sell-off in precious metals.

Market implications and investor outlook

The sharp decline signals a potential shift in market sentiment after a prolonged period of aggressive gains driven by geopolitical uncertainty, inflation concerns, and a weak dollar. For investors, particularly in markets like Türkiye where gold is a traditional store of value and a hedge against currency volatility, such sharp corrections highlight the asset's dual role as both a safe haven and a speculative instrument. Analysts are now watching to see if this marks a healthy correction within a longer-term bull market or the beginning of a more sustained downtrend as monetary policy expectations evolve under new leadership at the Fed.