Silver Prices Crash 16.6%, Gold Slides 3.5% in Major Precious Metals Selloff
Silver prices experienced a dramatic collapse on Thursday, plunging as much as 16.6% during the trading session and completely wiping out all gains accumulated over the previous two sessions. This severe downturn represents a continuation of the precious metal's struggles following last week's historic market crash that rattled global commodity markets.
Gold Joins the Downward Spiral as Pressure Mounts Across Precious Metals
Gold prices followed silver lower, declining by as much as 3.5% amid sustained pressure across the entire precious metals complex. The volatility was particularly striking in silver, which briefly climbed back above $90 per ounce during early Asian trading only to reverse sharply and enter a steep downward trajectory that persisted throughout the session.
"Sentiment seems to have turned soggy across most asset classes, including regional equities and metals," observed Christopher Wong, a strategist at Oversea-Chinese Banking Corp Ltd in comments to Bloomberg. "This highlights fragile sentiment and has triggered a feedback loop amid thin market liquidity."
From Spectacular Rally to Abrupt Collapse
This sharp reversal follows what had been a remarkable rally throughout last month, when precious metals surged rapidly due to multiple converging factors:
- Speculative buying driving prices upward
- Escalating global geopolitical tensions
- Growing concerns about the independence of the US central bank
That impressive rally came to an abrupt halt late last week, with silver recording its biggest ever one-day fall on Friday, while gold experienced its steepest single-day decline since 2013.
Federal Reserve Policy Uncertainty Weighs on Markets
Market attention has now shifted decisively toward monetary policy outlooks following the nomination of Kevin Warsh as the next Federal Reserve chair. President Donald Trump added to the uncertainty on Wednesday by stating he would not have selected Warsh if the nominee had supported raising interest rates.
In an interview with NBC News, Trump expressed little doubt that the Federal Reserve would implement additional rate cuts, noting there was "not much" uncertainty about this direction. Such monetary easing typically supports precious metals since they don't offer interest payments, making them more attractive when rates decline.
"Price action is likely to remain volatile until there is greater certainty on the monetary policy outlook," cautioned Standard Chartered Plc analysts including Sudakshina Unnikrishnan in a research note.
Structural Drivers Remain Despite Current Turbulence
The analysts acknowledged that some of the recent dramatic price swings resulted from investors withdrawing funds from exchange-traded products, but they maintained that "structural drivers remain intact and we continue to expect a rebuild to the upside" for precious metals over the longer term.
Closing Prices and Broader Market Impact
By 11:18 am Singapore time, silver was trading 12.7% lower at $76.9495 per ounce, while gold had declined 2.1% to $4,859.20 per ounce. The selloff extended to other precious metals as well, with both platinum and palladium registering declines. Meanwhile, the Bloomberg Dollar Spot Index edged up 0.1%, adding further pressure to dollar-denominated commodities.
This precious metals rout reflects broader market fragility and highlights how quickly sentiment can reverse in thin trading conditions, particularly when uncertainty surrounds central bank policies and global economic outlooks.
