After experiencing a two-day relief rally, both silver and gold prices encountered renewed selling pressure during Thursday's trading session on 9 February. This downward movement effectively wiped out the recent recovery that investors had been cautiously optimistic about.
Factors Driving the Precious Metals Decline
The renewed selling pressure was primarily attributed to a firm US dollar, which made dollar-denominated metals more expensive for holders of other currencies. Additionally, a lack of fresh market triggers and easing geopolitical tensions contributed to the decline, keeping safe-haven metals out of investors' immediate focus.
Comex Futures Show Significant Corrections
Following a flat close in the previous session, April futures contracts for gold on Comex dropped by $145 per ounce to reach the day's low of $4,805. This price action kept gold below the psychologically important $5,000 mark for the fifth consecutive trading session.
From its record high of $5,626, gold prices have corrected by nearly 14.6% over six trading sessions, including today's decline. Precious metals have been experiencing wild price swings over recent sessions, with both gold and silver posting their steepest losses in decades last Friday.
Silver Experiences Even Deeper Correction
Silver prices, which serve dual roles as both precious and industrial metals, dropped even more dramatically by 13%. This represented a decline of $11 per ounce to reach the day's low of $73.41, completely erasing the two-day recovery that had provided temporary relief to investors.
The white metal has struggled to find a stable floor following a historic market rout. After a record-breaking rally that many analysts considered to have moved too far, too fast, silver has now retreated by more than a third from its all-time high of $121.78 reached on 29 January.
Historical Context and Market Drivers
Silver had been on a remarkable record-breaking spree before the recent crash. Throughout 2025, the metal gained approximately 146%, with market analysts pointing to speculative flows, leveraged positioning, and options-driven trading as key drivers of these extreme price movements, rather than fundamental physical demand.
Political Developments Impact Market Sentiment
The precious metals rally came to an abrupt halt and transformed into sharp volatility following the nomination of Kevin Warsh as the next Federal Reserve chair by US President Donald Trump. Market participants viewed Warsh as more hawkish than other potential candidates, leading to expectations of a slower pace of potential interest rate cuts.
Further easing of geopolitical tensions has also removed risk premiums that had previously supported precious metal prices, causing once-dominant metals to experience sharp declines. Despite these recent setbacks, both silver and gold continue to trade at elevated levels compared to historical averages, following the accumulation of substantial gains in recent months.
Domestic Market Impact in India
In the domestic Indian market, the February futures contract for gold on MCX slipped back below the ₹1.50 lakh threshold as prices extended losses for a second consecutive day. Gold fell another ₹4,590 per 10 grams to reach ₹1,48,455, pushing prices nearly 19% below the recent peak of ₹1,54,200.
Meanwhile, the March silver futures contract opened with a significant gap-down at ₹2,58,096 per kilogram. Selling pressure intensified as the trading session progressed, dragging prices down by ₹29,850 to hit the day's low of ₹2,39,000. This represented a substantial decline from Wednesday's closing price of ₹2,68,850.
The sudden and sharp decline in precious metals has also negatively impacted sentiment in base metals markets, creating broader concerns across the commodities sector. Investors are advised to exercise caution and consult with certified financial experts before making any investment decisions in this volatile market environment.
