Precious metals saw sharp swings Monday as hopes of easing tensions in the Iran conflict briefly boosted investor sentiment.

Spot gold fell over 5% to $4,262.50 before recovering to $4,482, while futures dropped around 1.5% after an earlier 10% plunge, extending losses that have totaled roughly 25% since January’s record high.

Silver, platinum, and palladium also plunged, with silver hitting a year-to-date low of $63.76 and platinum futures down 9.7% to $1,780.20.

The retreat reflects a broader risk-off mood, as investors anticipate higher interest rates and rising energy costs, shifting preference toward government bonds over non-yielding metals, CNBC has reported.

Analysts note central banks and Gulf states may be drawing on accumulated gold reserves, signaling a shift from accumulation to capital preservation and a natural ceiling on gold prices.