China's onshore gold, silver prices plunge as overheated trading and easing sentiment trigger correction

After surging to record highs in late January, gold and silver prices plunged sharply in early February, with Shanghai gold futures losing more than Yuan 200/gram ($28.8/g) in less than two trading days, as overheated trading, easing risk sentiment, and shifting expectations around U.S. monetary policy triggered a violent correction in precious metals markets.

Gold prices peaked on January 29, reaching record intraday highs in both China's domestic and international markets. That day, the benchmark gold futures contract on the Shanghai Futures Exchange surged to as high as Yuan 1,258/g -- more than double its level a year earlier. The rally, however, quickly