Monday’s trading session brought partial recovery to precious metals markets after a severe downturn that created widespread concern among investors. Gold prices rebounded from an 8% collapse to $4,465 per ounce, climbing back to $4,700 though remaining 3.5% lower for the day. The precious metal had been approaching $5,600 per ounce in recent trading.
Silver followed a similar pattern of recovery, advancing from a 7% decline following Friday’s catastrophic 30% drop to settle at $79.60 per ounce. The stabilization in metals markets contributed to a historic achievement for Britain’s flagship equity index, which crossed above 10,300 for the first time, closing at 10,341 with an intraday peak of 10,345.
Recent trading had seen both precious metals reaching successive peaks as investors pursued safe harbor from mounting geopolitical tensions and concerns about Federal Reserve autonomy. The market reversal began when authorities announced Kevin Warsh, a former Fed governor with distinguished credentials, as the nominee to chair the Federal Reserve. If confirmed, Warsh will replace the current leader when his term ends in May.
Market analysts characterize the selloff as investor approval of maintaining central bank independence. Wealth Club’s Susannah Streeter highlighted that Warsh’s substantial Fed experience indicates he won’t yield to political pressure, triggering the major shift away from safe-haven positions. Pepperstone’s Michael Brown labeled Friday’s initial decline a comprehensive “meltdown in the metals space.”
Jefferies analysts explained the movement as unwinding of overcrowded trading positions, with positioning indicators falling from extreme levels to more moderate ranges. Despite recent volatility, Deutsche Bank analysts maintain their forecast for gold to reach $6,000 this year, while both metals preserve substantial year-over-year gains of 65% for gold and over 120% for silver.