COMEX gold falls over 1%, silver tumbles nearly 4% amid inflation worries

Gold and silver prices fell sharply on Friday (May 15), with both precious metals heading toward weekly losses as rising crude oil prices, a stronger US dollar and concerns over prolonged higher interest rates weighed on investor sentiment.

COMEX gold last traded at $4,626.30 per ounce, down $59 or 1.26%, after touching an intraday low of $4,611.60 an ounce. COMEX silver declined even more sharply, falling 3.88% to $82.02 per ounce.

In the spot market, gold was down nearly 2% for the week.

Analysts said investors continued to pull back from precious metals as elevated energy prices raised fears of persistent inflation, potentially delaying interest rate cuts by the US Federal Reserve.

Brent crude prices climbed

around 5% this week and remained above $106 per barrel amid ongoing tensions linked to the Iran conflict and disruptions around the Strait of Hormuz. Higher oil prices have strengthened inflation concerns globally, adding pressure on bullion markets.

The US dollar also gained more than 1% this week, making gold and silver more expensive for holders of other currencies and reducing overseas demand.

Markets are also tracking talks between US President Donald Trump and Chinese President Xi Jinping, with investors watching for signals on trade, Taiwan, artificial intelligence and geopolitical risks.

Recent US economic data added to the cautious mood. Retail sales rose for a third straight month in April, while labour market data continued to point to resilience in the economy despite inflationary pressures from higher energy costs.

Federal Reserve Bank of New York President John Williams said the central bank currently sees no immediate need to change interest rate policy amid uncertainty caused by the Middle East conflict, reinforcing expectations that borrowing costs may remain elevated for longer.

India, meanwhile, moved to restrict gold imports under its advance authorisation scheme by capping shipments at 100 kilograms for exporters availing duty exemptions.

According to Prithviraj Kothari, Managing Director at RiddiSiddhi Bullions, President of India Bullion and Jewellers Association and Chairman at Jain International Trade Organisation, silver has continued to outperform gold in recent weeks due to strong industrial demand from sectors such as solar energy, electric vehicles and AI-linked data centres. He noted that the gold-silver ratio narrowed sharply over the past week as silver climbed close to the $90 level earlier.

Analysts said gold could remain range-bound in the near term as geopolitical tensions support safe-haven demand, while elevated bond yields, sticky inflation and a firm dollar continue to cap gains.

-With Reuters inputs