![\"\"](\"https:\/\/www.innov8fs.co.za\/blog\/wp-content\/uploads\/2026\/03\/Copper-joins-gold-in-broad-commodities-sell-off.-Theres-a-worrying-reason-behind-it.webp\")
<\/p>\n<\/p>\n
Prices for metals fell sharply across the board Thursday as investors worried about the impact rising oil prices due to the U.S.-Iran war will have on the global economy.<\/p>\n
Gold fell nearly 6%, while silver was off 8%. The sell-off extended beyond just those two, as industrial metals like copper and palladium came under pressure, declining 2% and 5.5%, respectively.<\/p>\n
While the selling intensified on Thursday, gold and silver have been falling since the war in Iran began, despite the former being viewed as a safe-haven asset. Surging oil prices have created concerns that inflation will reignite and keep interest rates higher. Higher rates weaken the appeal of the bullion, which is non-yielding.<\/p>\n
A stronger dollar as a result of the higher rates has also weighed on gold, as it cheapens the metal.<\/p>\n
\u201cThe risks to inflation taking away the Fed rate cuts that were priced in, and seeing interest rate increases across the world, and real rates rising, that has been the drag on gold,\u201d said Peter Boockvar, CIO at One Point BFG Wealth Partners. The U.S. 10-year Treasury yield at one point on Thursday crossed 4.300%.<\/p>\n
Meanwhile, copper and palladium, after declining at the onset of the war, stayed relatively stable. But that has changed as growth concerns begin to weigh on these industrial metals.<\/p>\n
Industrial metals are used in practical ways. Copper, for example, is in everything from electronic devices to electrical wiring and plumbing systems. A decline in copper prices is normally viewed by the Street as a sign of slowing economic growth.<\/p>\n
Wall Street consensus has generally been that the longer the war goes on, the greater is the risk that oil prices remain elevated for long enough that it alters the spending habits of consumers and businesses and leads to a recession. It\u2019s the \u201cdemand destruction\u201d phase of an energy shock that traders and investors are chattering about.<\/p>\n
\u201cOn the industrial metal side\u2026 people are now really worried about the recession risks,\u201d Boockvar said. And slower growth combined with higher inflation is a \u201cstagflation\u201d scenario. But while investors begin to make \u201cstagflation\u201d trades, others see the possibility as extremely unlikely.<\/p>\n
Ed Yardeni, president of Yardeni Research, wrote in a Tuesday note that \u201coil shocks are less likely to trigger the kind of sustained stagflation seen in the past, particularly during the 1970s,\u201d referencing the economic consequences of the 1973 OPEC embargo. He noted that Russia\u2019s invasion of Ukraine in 2022, while it caused an oil shock and higher inflation, didn\u2019t lead to a recession.<\/p>\n
It\u2019s a belief that Fed Chair Jay Powell repeated in a press conference on Wednesday. \u201cI would reserve the term stagflation for a much more serious set of circumstances.\u201d<\/p>\n
While Boockvar thinks the war needs to end for industrial metals\u2019 prices to stabilize, he said gold can likely recover as focus returns to countries\u2019 rising debts and deficits, which gold typically does well against as a \u201cdebasement trade\u201d play. He added that those deficits might only worsen due to military spending on the war. And even if stagflation does arrive, head of asset allocation research at Goldman Sachs Christian Mueller-Glissmann wrote in a Thursday note gold is a play in that environment.<\/p>\n
\u201cIn case of a continued stagflationary shock, especially if real yields are declining, we would expect more support for Gold prices due to investor demand for real assets and FX diversification,\u201d he wrote.<\/p>\n
Markets shift and headlines fade, but the core principles of building long-term wealth remain constant. Join us for our third CNBC Pro LIVE, where investors of all backgrounds – from financial professionals to everyday individuals – come together to cut through the noise and gain actionable strategies for smarter, more disciplined investing. No matter where you\u2019re starting from, you\u2019ll leave with clearer thinking, stronger strategies. Enter your email here to get a discount code<\/p>\n
Prices for metals fell sharply across the board Thursday as investors worried about the impact rising oil prices due to the U.S.-Iran war will have…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-2168","post","type-post","status-publish","format-standard","hentry","category-innov8ions"],"_links":{"self":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/2168","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/comments?post=2168"}],"version-history":[{"count":2,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/2168\/revisions"}],"predecessor-version":[{"id":2171,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/2168\/revisions\/2171"}],"wp:attachment":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/media?parent=2168"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/categories?post=2168"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/tags?post=2168"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}