Gold, Silver Drop Again on 'Bond Tailspin' and Weak Demand Fears - BullionVault

AI desk brief

Gold and silver sold off again as rising long-end bond yields and fresh doubts over late-2026 physical demand pressured the complex. Gold slipped back through $4,300/oz in London trading, while silver hit a two-week low at $63.33 and was 9.5% below last Friday’s peak. The move was framed as a continuation of the “bond tailspin” trade: weaker government bond prices are pushing long rates higher, keeping bullion on the back foot even as equities also softened.

On the demand side, India was the main near-term headwind. Prime Minister Modi urged households not to buy gold ahead of the autumn festive and wedding season, while the Confederation of All India Traders warned private-sector gold buying could fall to 500t this year from 800t, citing high prices and import duties. In China, Shanghai gold traded down to ¥931/g, cutting the premium to around $5/oz over London—roughly one-third below the usual import incentive.

Silver also took a hit from industrial-demand concerns after Bloomberg flagged a second straight annual decline in solar-sector demand, with JPMorgan’s Greg Shearer saying global solar demand for silver could drop 30% this year versus 2025 as silver-free PV technology gains traction. StoneX’s Rhona O’Connell said gold and silver are watching the Fed closely, noting that central-bank buying still offers gold support, while silver may face only a shorter-term oversupply shock before moving into a broader supply deficit over coming years.