Gold, silver, and palladium haven’t been doing too well lately: over the past month, gold prices are down almost 6%, while palladium has dropped by nearly 20%.
What’s behind this pessimism?
Mainly because inflationary pressures are sticking around, with no progress on a peace deal with Iran. If anything, things seem to be moving backwards after the US struck Iran’s Qeshm Island and an Indian merchant vessel came under attack off the coast of Oman.
On top of that, the media have repeatedly reported that US officials are considering a strike on Iran after the midterms, with military assets reportedly already being moved into position for a potential operation.
The question is, if previous attacks didn’t make Iran any more willing to negotiate, why would things be any different this time?
And with oil prices bouncing back, markets clearly have their doubts about a deal, keeping inflationary risks alive and potentially forcing central banks to tighten monetary policy again. The good news is that markets are already pricing in rate hikes from both the Fed and the ECB as early as December.
And that’s another reason precious metals are losing their appeal: they don’t pay any interest, unlike bonds, which become more attractive as monetary policy tightens.
The semiconductor sell-off may have dragged metals down too, but concerns about weaker demand for copper and silver, both widely used in data centers, could also be weighing on prices.
Whether this is a good time to buy precious metals depends on what happens in the Middle East and whether the tech sell-off continues, with the US midterms potentially being a turning point in both cases.
In the first case, Democrats have already put together a first-100-days agenda in case they regain control of the House of Representatives, and potentially the Senate, and one of the key points is a demand to end the war with Iran.
As for the second, democrats could also introduce independent safety reviews for powerful AI models, require companies to report serious incidents, impose additional requirements on AI training, and further restrict data center construction.
So, all eyes are on the US midterm exit polls, with Democrats already holding a strong position in prediction markets, which put their chances of taking the House at 90% and the Senate at 80%.
By – https://www.kitco.com/opinion/2026-11-03/whats-going-precious-metals