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Gold, Silver Rout Deepens as CME Margin Hikes Trigger Forced Selling

Costlier futures drove rapid position cuts following a shift toward more hawkish Federal Reserve expectations.

Overview

  • Spot and futures prices extended losses on Monday, with gold dropping about 3% intraday after a much steeper plunge late last week and silver falling more sharply as volatility persisted.
  • CME Group raised margin requirements on Comex gold and silver, increasing trading costs and accelerating deleveraging that began after President Trump nominated Kevin Warsh to lead the Fed.
  • India’s MCX contracts repeatedly hit lower-circuit limits during a special Budget-day session on Sunday, and exchanges, ETFs and exchange-linked products logged heavy two-day declines.
  • Domestic factors shaped local moves as the Union Budget kept bullion import duties unchanged, pressuring premiums, while city-level prices remained elevated versus long-term averages.
  • Analysts tie the reversal to a stronger dollar, higher yields and crowded long positioning, while noting longer-term supports such as central-bank buying and industrial demand for silver.