Silver plunged more than 6% in its steepest drop in six months, snapping a blistering rally that had pushed the metal to fresh all-time highs above $54 an ounce this week.
In New York, spot silver fell 4.4% to $51.88 an ounce, while gold slipped 1.9%. Platinum and palladium also posted losses, as the entire precious metals complex cooled off.
The pullback came as easing fears over U.S. credit risk and U.S.–China trade tensions dented demand for safe-haven assets. President Donald Trump’s Friday comments appeared to calm anxiety around trade frictions, while strong earnings from regional U.S. banks helped lift bond yields and stabilize equity markets — both negative signals for bullion, which doesn’t yield interest.
A historic silver squeeze in the London market also began to unwind. The extreme tightness had recently sent silver prices soaring above New York futures, forcing traders to airlift metal across the Atlantic. But warehouse outflows from Comex — over 15 million ounces this week — and a 10-million-ounce selloff from ETF holdings on Thursday are now easing that pressure.
“The London shortage is alleviating somewhat from extreme levels,” said Nicky Shiels, head of metals strategy at MKS Pamp SA. “As regional dislocations smooth out, there could be pressure and profit-taking.”
Technical indicators support the correction. A relative strength index showed silver had entered overbought territory after a weeks-long surge, signaling a high likelihood of a pullback. Gold, which is still up over 60% this year, also showed signs of similar momentum fatigue.
Despite the drop, many traders remain bullish on the longer-term outlook for precious metals, especially if the U.S. Federal Reserve proceeds with more aggressive rate cuts by year-end — a scenario that typically boosts non-yielding assets like gold and silver.