Gold’s frenzied rally ends with biggest sell-off in over a decade

Gold prices rose slightly on Wednesday after the precious metal’s dramatic rise came to an abrupt halt on Tuesday, when prices fell more than 5%.

The fall in the price of gold, seen as a safe haven in times of uncertainty, came as investors took profits on a record rise and as U.S. and Chinese officials are expected to meet again for a new round of trade talks.

Gold was last trading at $4,141.48 per troy ounce at 1:46 a.m. ET Wednesday, up less than 0.4%.

On Tuesday, spot gold fell 6.3% to $4,082.03 per troy ounce, after hitting an all-time high of $4,381.21 on Monday. U.S. gold futures fell 5.7% to $4,087.70, marking the biggest percentage decline since April 2013. Silver and platinum also fell sharply on Tuesday, down 7% and 5% respectively.

Analysts said the selloff followed weeks of heavy buying that had pushed gold to overheated levels.

Gold experienced historic gains in 2025, its rise of more than 50% surpassing previous volatile periods such as after the September 11 attacks, the 2008 financial crisis and the Covid-19 pandemic.

In the past two months alone, gold prices have risen 25%, driven by demand amid growing U.S. government debt, political uncertainty and speculation about further interest rate cuts by the Federal Reserve.

But optimism about easing trade tensions between Washington and Beijing, as well as a rebound in the U.S. dollar, prompted investors to book profits. Despite renewed tensions between the world’s two largest economies in recent weeks, their trade representatives are expected to meet at the end of the week ahead of a planned meeting between Chinese leader Xi Jinping and US President Donald Trump next week.

“I think we will probably reach a very fair agreement with Chinese President Xi,” Trump said Monday. “I think we’ll find something good.”

Analysts also pointed to the end of the Diwali holiday in India, the world’s second-largest gold consumer, reducing physical demand, as another reason for the fall in gold prices.