Gold and silver prices reversed recent gains following military strikes between Iran and the United States on 6 July, according to precious metals analysts at Heraeus. The strikes prompted gold to fall below $4,100 per ounce and silver below $60 per ounce. The conflict escalated after Iran's Revolutionary Guard Corps fired missiles at commercial ships on 6 July, triggering US retaliatory strikes, followed by Iranian strikes on Bahrain, Kuwait and Qatar. The exchanges occurred despite a Memorandum of Understanding signed on 17 June between Iran and the US that had enabled sanctions removal and the lifting of the Strait of Hormuz blockade. The military actions have strained the ceasefire and raised concerns about potential impacts on price stability and monetary policy.
Iran-US Military Strikes Drive Precious Metals Price Drop
The gold price fell back below $4,100 per ounce and silver below $60 per ounce following the military exchanges, Heraeus analysts reported. Oil rallied with Brent Crude and WTI topping $80 per barrel and $75 per barrel respectively on Wednesday. Since then, oil prices have fallen slightly and precious metal prices have rebounded. Spot gold traded at $4,013.64 for a loss of 2.60% on the session on Monday morning. Spot silver last traded at $58.089 per ounce for a loss of 2.97% on the daily chart.
Central Banks Purchase 41 Tonnes Gold in May
Central banks were strong buyers of bullion in May, purchasing 41 net tonnes of gold, according to Heraeus. The central banks of Poland and China led the way, purchasing 18 tonnes and 10 tonnes, respectively. The National Bank of Poland's reserves now stand at 614 tonnes, surpassing the Netherlands as the tenth-largest gold reserve holder in the world and standing 86 tonnes short of its 700-tonne target. Uzbekistan and Kazakhstan also increased their reserves by 9 tonnes and 7 tonnes, respectively in May. These purchases come mainly from domestic production allowed for by Kazakhstan and Uzbekistan's priority rights to buy gold produced in their countries, the analysts noted.
China added to its gold reserves for the twentieth consecutive time last month. The People's Bank of China purchased 15 tonnes of gold in June, the biggest monthly addition since October 2023 when it purchased nearly 22 tonnes. The PBoC now holds 2,346 tonnes of gold which makes up around 9% of the value of its total reserves.
Perth Mint Silver Sales Fall 37% Year-on-Year in June
The Perth Mint announced silver sales of 294 koz in June, down 19% from 364 koz in May which was itself the lowest monthly total since April 2012, Heraeus analysts reported. June's sales also marked a 37% year-on-year reduction from the 464 koz of silver sold in June 2025. This came as the silver price dropped 22% in June from $75 per ounce to $58.5 per ounce. Gold bar and coin sales fared better though, with 29.7 koz sold, an increase of 53% from 19.4 koz in May.
Sierra Gorda Expansion Targets 2030 Production Start
The expansion of the Sierra Gorda joint venture, owned by KGHM and South32, will add a fourth grinding line to increase processing capacity by roughly 25%. The first production from the expansion is expected in 2030 and full production rates in 2031, the analysts said. Once completed, the project is projected to incrementally lift annual silver production to around 1.7 moz, alongside higher copper, molybdenum and gold output. KGHM is one of the world's largest silver producers, with the Group producing 43.3 moz of silver in 2025.
FAQ
What caused gold and silver prices to drop on 6 July?
Gold and silver prices fell after Iran's Revolutionary Guard Corps fired missiles at commercial ships on 6 July, prompting US retaliatory strikes. Iran followed with strikes on Bahrain, Kuwait and Qatar. Gold dropped below $4,100 per ounce and silver fell below $60 per ounce.
How much gold did central banks purchase in May?
Central banks purchased 41 net tonnes of gold in May. Poland led with 18 tonnes, followed by China with 10 tonnes, Uzbekistan with 9 tonnes, and Kazakhstan with 7 tonnes.
Why did Perth Mint silver sales decline in June?
Perth Mint silver sales fell to 294 koz in June, down 37% year-on-year from 464 koz in June 2025. The decline occurred as the silver price dropped 22% in June from $75 per ounce to $58.5 per ounce.
