Gold price falls on profit-taking

Spot gold plunged nearly $300 from Monday’s peak of $4,380.89 per oz. to a low of about $4,090.97. U.S. gold futures also weakened, sliding roughly 5.4% to around $4,100 per ounce. The gold price was down further at $4,070.28 per oz. on Wednesday morning, a 7.1% drop from Monday.

The retreat ended a nine-week streak of gains that had lifted bullion to unprecedented levels, driven by steady central bank purchases, geopolitical tensions and expectations of looser monetary policy.

Correction

“Yesterday’s major correction in the gold price likely reflected profit taking from momentum based and retail investors following the steep price run up in recent weeks,” BMO Capital Markets said in a note on Wednesday.

“We see corrections/pauses as only expected, but maintain our view for $4,500 per oz. average prices in the second half of 2026, driven by U.S. rate cuts, and the ongoing long term theme of currency diversification,” BMO commodities research analysts Helen Amos and George Heppel wrote. 

They also cited slowing India seasonal demand for the price fall and investors choosing treasuries for safe haven instead of gold amid recent market volatility. Inflows to exchange traded gold funds had reached a record of $8 billion last week reflecting the pace of new money entering the bullion market, the analysts said. 

Still up 55%

Gold’s run since midyear was underpinned by safe-haven demand during global conflicts, concerns over economic growth, and central banks reducing exposure to the U.S. dollar. With bond yields stabilizing and appetite for risk assets improving, some of the drivers behind gold’s surge have eased.

Bond veteran Bill Gross had forecast the downturn, saying last week the price was overextended. But even after this week’s decline, gold remains one of the strongest-performing commodities of the year, up about 55%.

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