Gold fell more than 2% and silver dropped almost 4% on the day the United States struck Iran and crude jumped nearly 7% — the exact war-and-oil setup that usually lifts bullion. Kitco’s Przemyslaw Radomski argues the sell-off shows the metal is answering to the dollar and rate expectations, not fear.
Gold fell more than 2% on the morning that, by the usual playbook, should have sent it higher. The United States struck Iran again overnight, answering an attack on three tankers in the Strait that Washington called a breach of the ceasefire, and the Treasury cut off Iran’s license to sell oil. Yet the safe-haven bid went to the dollar instead of the metal.
Crude surges 7% on fresh sanctions
The trigger sat in the oil pit. With Iran hitting three ships, the US striking back, and the Treasury pulling the waiver that let Iranian barrels reach the market, crude ran nearly 7% higher. That move, Kitco’s Przemyslaw Radomski wrote, is the engine under everything else on the screen.
A shooting war on a chokepoint that carries a fifth of the world’s oil is the setup every gold bull points to. Instead, gold broke lower and gave back the bounce it had spent a week building. Radomski read the reaction as a sign the metal is answering to the dollar and the rate behind it rather than to fear.
Why the dollar won the bid
Higher oil feeds higher inflation, which keeps the Federal Reserve leaning toward hikes and lifts the real yields that raise the cost of holding metal paying nothing. Because the United States sells energy to the world, a crude spike also tends to lift the dollar — which Radomski noted broke above 100 and verified that breakout last week.
Silver told the same story louder. On a morning built for an inflation hedge to soar, silver instead led the sector down, off nearly 4%.
Radomski flagged one caveat: if the Strait were to close outright and crude ran well above $100, the shock could turn harsher and gold’s role could flip, as it did in the 1970s. For now, with mining stocks down almost 5% the prior day, he put the odds on a slide well below the flag pattern, perhaps to new 2026 lows.
Source: KITCO
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