Multiple Varieties Hit New Lows This Year! How Big Is the Shock Wave of Precious Metals' New Round of Plunge?

Precious metal prices continue to decline, how significant is the impact?

Recently, the prices of precious metals including gold, silver, platinum, and palladium have experienced consecutive large adjustments, forming a new downward trend for the year, with most prices hitting new lows for the year. Additionally, the sharp decline in precious metals has also propagated to the stock and fund markets, causing related stocks to plummet and ETF sizes to shrink significantly. These phenomena have attracted widespread market attention.

Senior researcher Zhu Shanying from the Macro Research Group of CITIC Futures Research Institute told Securities Times that the ongoing escalation of the geopolitical conflict between Iran and the U.S., sustained strength in energy prices, the delay in rate cut expectations, and worsening market risk appetite are the core reasons for the recent significant adjustment in precious metal prices.

Precious metals are experiencing a new round of collective plunge: multiple varieties hit new lows for the year

Under the influence of multiple factors, the prices of precious metals including gold, silver, platinum, and palladium have recently undergone a fierce decline, reaching new lows for the year.

Taking gold as an example, in the domestic market on March 23, the Au99.99 gold contract price on the Shanghai Gold Exchange further declined, closing down by as much as 11.23%, with the lowest intraday price dropping to 911 yuan/gram, a new low for the year. In less than a month, the Au99.99 gold contract on the Shanghai Gold Exchange has fallen over 20% from its recent high, and the main gold futures contract on the Shanghai Futures Exchange has also declined more than 20% from its recent high.

Silver prices have fallen even more sharply. On March 23, the main silver futures contract on the Shanghai Futures Exchange plunged over 13% intraday, hitting a new low for the year, with the lowest price at 15,070 yuan/kg, roughly halving from its high for the year.

Prices of platinum and palladium have also fallen significantly. On March 23, the main platinum futures contract on the Guangdong Futures Exchange dropped over 15% intraday, reaching a new low for the year, while the main palladium futures contract also fell over 14% intraday, hitting a new low for the year.

Prior to this, in 2025 and January 2026, many precious metal varieties had shown impressive gains, making them one of the hottest investment categories at the time. In February this year, due to hawkish personnel nominations, market expectations for Fed rate cuts shifted, causing an epic adjustment in precious metal prices. Now, with the escalation of conflicts in the Middle East, precious metals are undergoing another large-scale adjustment, with the downward trend intensifying.

It is noteworthy that the significant volatility in precious metal prices has prompted some exchanges involved in trading these metals to issue risk warnings again. For example, on March 23, the Shanghai Gold Exchange issued a notice on strengthening risk control measures, stating that recent market instability factors have increased, and precious metal prices are highly volatile. The exchange urged member institutions to closely monitor market changes, prepare detailed emergency risk plans, and maintain market stability. Investors are also advised to be cautious, control positions reasonably, and invest rationally.

The impact has spread to stocks and ETFs

The recent collective plunge in precious metal prices has also affected stocks and ETFs tracking gold and other precious metals.

In the stock market, on March 23, the Shenwan Precious Metals Index plummeted 8.38%. In fact, the index had already begun to adjust in February, with an 11.45% decline that month, and since March, it has fallen another 20.75%.

Statistics show that among the constituent stocks of the Shenwan Precious Metals Index, most have experienced significant retracements from their highs for the year. Currently, stocks like Hunan Silver, Zhaojin Gold, Shandong Gold, CICC Gold, Western Gold, Hengbang Shares, and Xiaocheng Technology have retreated over 40% from their peak levels this year. Notably, Shandong Gold and Hengbang Shares hit new lows for the year on March 23.

Some ETFs tracking gold and other precious metals have also seen their sizes shrink sharply recently. The decline in gold and other precious metals has caused the net asset value per unit of related ETFs to fall, leading to a reduction in fund size.

For example, the Hu’an Gold ETF, which had a size of 126.8 billion yuan as of March 17, 2026, shrank by about 0.5 billion yuan on March 18, by about 6.1 billion yuan on March 19, and further by about 2.8 billion yuan on March 20. Another large gold ETF, the Bosera Gold ETF, also experienced similar changes, with its size shrinking nearly 200 million yuan on March 18, and about 2.5 billion yuan on March 19, and about 800 million yuan on March 20.

What do experts say?

Zhu Shanying told Securities Times that the ongoing escalation of the Iran-U.S. geopolitical conflict, sustained strength in energy prices, the delay in rate cut expectations, and worsening market risk appetite are the main reasons behind the recent sharp adjustment in precious metal prices. Last week, the Federal Reserve held its March policy meeting. Although the dot plot indicated one more rate cut by the end of the year, the SEP (Summary of Economic Projections) raised inflation and growth expectations, signaling that the Fed is currently more focused on “inflation” risks rather than “stagnation.” After the meeting, the market quickly priced in no rate cuts this year, with U.S. Treasury yields rising sharply and equity markets remaining weak, leading to a significant adjustment in precious metals.

Regarding the future trend of gold, silver, and other precious metals, Zhu Shanying believes that in the short term, under continued geopolitical tensions, precious metals will remain under pressure, and risks of further deterioration in risk appetite should be watched carefully. However, the long-term bullish outlook remains unchanged. From the perspective of interest rate expectations, last week’s escalation of conflicts and hawkish Fed signals have pushed rate cut expectations to near zero, with even some pricing in rate hikes. Short-term interest rate expectations may be overly pessimistic. Nonetheless, the deterioration of market risk appetite may continue, with global stock markets remaining weak and the risk of further selling in precious metals still present. In the short term, further worsening of risk appetite could weigh on prices. Long-term, under the ongoing escalation of Iran-related tensions, inflation expectations are rising significantly, which is bullish for gold. If the U.S. gets stuck in a prolonged conflict, it could further increase U.S. debt pressures and accelerate de-dollarization in emerging markets, potentially weakening the dollar’s credit and reinforcing the long-term bullish case for precious metals.

Zhu Shanying believes that in the first half of the second quarter, the main market theme may focus on the delay of rate cuts driven by rising inflation expectations, i.e., the “inflation” negative. As inflation effects become more apparent, concerns about stagnation may gradually surface, and the expectation of rate cuts could recover, potentially leading to a rebound in precious metals. In terms of timing, attention should be paid to the progress of geopolitical conflicts—if there is a phase of easing, it could restore rate cut expectations and risk appetite. Additionally, watch for the progress of the Federal Reserve’s leadership transition, as the new chair may provide new guidance on interest rate paths.