The conflict in the Middle East is reshaping market dynamics. Gold, traditionally viewed as a safe-haven asset, has experienced consecutive declines, while silver has seen a rare and sharp plunge. Simultaneously, industrial metals like LME copper, aluminum, and tin have also sold off heavily, creating an unusual synchronized downturn for both precious and industrial metals. The driving force is no longer a simple supply-demand narrative but a dual pressure from energy shocks boosting inflation, which in turn suppresses expectations for interest rate cuts, leading to liquidity tightening and concerns over demand. Commodities as a whole are entering a phase of pressure. Rising inflation fears stemming from the escalating Middle East situation have severely impacted global commodity markets, triggering large-scale sell-offs in both precious and industrial metals. On Thursday, spot gold fell below $4,600 per ounce, dropping over 4% during the day and marking its seventh consecutive day of declines, the longest losing streak since 2023. Spot silver's decline was even more severe, plummeting over 12% intraday and falling below the $66 mark, hitting a new low since February 6. The main silver contract on the Shanghai Futures Exchange dropped 14% to 16,120 yuan per kilogram. Reports indicated that mutual strikes by Iran and Israel on key energy facilities in the Persian Gulf pushed oil prices higher, subsequently dampening market expectations for Federal Reserve rate cuts and putting pressure on non-yielding gold. International copper and SHFE copper fell over 3%, while liquefied petroleum gas rose over 4%. Rising oil prices due to the conflict are suppressing expectations for rate cuts. In the nearly three weeks since the Middle East conflict erupted, crude oil and natural gas prices have continued to surge, significantly increasing inflation risks. The Federal Reserve held rates steady at its meeting on Wednesday and reduced its forecast for rate cuts this year to just one. Chair Jerome Powell explicitly stated that any rate cuts would be conditional on seeing evidence of moderating inflation. Analysis suggests this stance directly reduces gold's appeal. Gold itself generates no interest income, making its holding cost relatively high in a high-interest-rate environment. As expectations for rate cuts diminish, capital tends to flow out of gold assets. Reports note that since the war began, gold's price action has resembled its decline during the summer of 2022. At that time, the Russia-Ukraine conflict triggered an energy price shock that transmitted through global markets. Although volatility in the precious metals market has moderated compared to the sharp swings seen in January, frequent price fluctuations have already deterred some investors seeking safety. ETF Outflows Continue, Safe-Haven Status Questioned Reports indicate that physical gold holding vehicles, represented by gold ETFs, have seen sustained net outflows in recent weeks, further weighing on the gold price. Gold ETFs are a primary channel for Western retail and institutional investors to hold gold, and their demand is particularly sensitive to changes in interest rates. Some investors have begun to view gold as a speculative asset rather than a traditional safe-haven tool. Although volatility has eased compared to January's intense price swings, persistent price turbulence continues to deter safety-seeking investors. The ongoing capital exodus further weakens the fundamental support for gold prices. Industrial Metals Hit by Historic Declines In the industrial metals sector, LME aluminum's single-day drop of over 8% was its largest since 2018, quickly erasing gains accumulated since the Iran conflict began due to regional supply risks. This indicates that concerns about the global economic outlook have spread to the industrial demand side. Furthermore, LME copper fell over 5%, last trading at $11,765.5 per ton. The main LME tin contract plunged 7% to $42,110.0 per ton. The broader commodities market was caught in a wave of panic selling, with declines for several varieties being rare in recent years. After the night session opened on the Shanghai Futures Exchange, SHFE aluminum, tin, and gold all fell over 5%. Analysis suggests the broad-based decline in commodity markets reflects investor anxiety over the escalating Middle East conflict, persistently high energy costs, and obstacles to policy shifts by major central banks. Until inflationary pressures show clear signs of easing, the market's repricing of the path for interest rate cuts is likely to continue exerting pressure on commodities.