Gold Tumbles Below $4,000 For First Time Since November 2025

Gold's extraordinary three-year rally has run into a wall.

The metal fell below $4,000 an ounce for the first time since November 2025, dropping as much as 3.7% to trade below $3,970, as a strengthening dollar and a hawkish turn from the new US Federal Reserve chair combined to shake out investors who had been piling into bullion for years.

At 4:32 PM today, spot gold was trading at $3,982.39, down 0.42%.

What Halted The Rally

Gold has been one of the best-performing assets on the planet. It posted double-digit gains in each of the past three years, more than doubling in price as central banks, institutional money managers and retail investors all chased the trade.

The metal peaked at close to $5,600 an ounce in late January. By June, it had fallen more than 20% from that high.

Three things broke the momentum:

• The US-Iran war drove energy prices sharply higher, feeding inflation and raising the probability of interest rate increases.

• New Federal Reserve Chair Kevin Warsh surprised markets last week by signalling a tough stance on inflation at his first rate-setting meeting, reinforcing expectations that rates will stay higher for longer.

• The dollar has gained nearly 1% this week, dollar-priced gold more expensive for buyers holding other currencies and reducing demand from international investors.

Wall Street Cuts Forecasts

Several major banks revised their gold outlooks downward in the past week. Goldman Sachs cut $500 from its forecast, now targeting $4,900 an ounce by year end. Deutsche Bank slashed its fourth-quarter estimate by 17%. Both banks pointed to continued outflows from gold-backed exchange-traded funds as evidence that the usual investor support for the metal is absent.

In China, gold's onshore discount to New York prices suggests imports will not provide a floor for the market either, Deutsche Bank said.

Also Read- Market Wrap, 25 June 2026: Sensex And Nifty 50 Lose Some Momentum At Close

The One Bright Spot

Central bank buying remains intact. Monetary institutions added to gold holdings at the fastest pace in more than a year during the first quarter, and survey data suggests they intend to keep buying. Both Goldman Sachs and Deutsche Bank identified central bank demand as the single remaining pillar supporting the market.

Silver also took a hit, falling below $60 an ounce for the first time since December, now down more than 50% from its January peak. At 4:46 PM, spot silver was trading at $57.17, down 0.45%.

Source:

NDTV Profit