Gold and Silver Prices Plunge as Latest Forecasts Spark Concern

Jakarta, CNBC Indonesia - Gold and silver prices plummeted amid US interest rate hike speculation.

According to Refinitiv, gold closed at $4,508.46 per troy ounce on Tuesday (26 May 2026), down 1.4%, reversing the previous day’s 1.4% gain. Prices rose slightly on Wednesday (27 May 2026) to $4,506.42 per troy ounce by 06:22 WIB, up 0.04%.

Jim Wyckoff, an analyst at American Gold Exchange, cited Refinitiv: ‘The bond market believes the next Federal Reserve move will be a rate hike, which is negative sentiment for the gold market today.’

Kevin Warsh was officially appointed as Federal Reserve Chair on Friday amid growing expectations that the US central bank will tighten monetary policy. Markets currently anticipate a 25-basis-point rate hike by December. Although gold is considered a hedge against inflation, the yieldless metal typically faces pressure in high-interest-rate environments.

Brent crude oil prices rose over 4% due to uncertainty over a potential US-Iran agreement and when shipping through the Strait of Hormuz will normalise. Rising oil prices drive inflation as producers pass on higher costs to consumers.

‘Technically, the market remains bearish in the short term, triggering technical selling,’ Wyckoff added. He noted that markets will monitor the release of the US Personal Consumption Expenditures (PCE) index on Thursday to gauge inflation pressures and the Fed’s future monetary policy direction.

Meanwhile, UBS cut its year-end gold price target by $400 to $5,500 due to ongoing risks from higher bond yields and a stronger US dollar.