Silver bars are collected in the safe deposit box room of the Pro Aurum gold house in Munich, Germany, January 10, 2025.
Angelica Warmuth | Reuters
Silver prices fell as much as 16% on Thursday, snapping a two-day rebound as the white metal continues to shake off excessive volatility.
Spot silver prices were last down 13% to $76.97 an ounce futures In New York, it fell more than 8% to $77.28 an ounce.
Silver was at record highs before plunging nearly 30% last Friday. In 2025, it will grow to about 146%, LSEG data showed.
Analysts point to speculative flows, leveraged positioning and options-based trading rather than physical demand as the main drivers of recent price swings.
“As prices fell, dealer hedging turned from buying to strong selling, investors stopped and losses cascaded through the system,” Goldman Sachs said in a note on Wednesday.
The price of silver in the last year
Silver’s correction was larger than gold’s due to increased liquidity conditions in the London market, which exacerbated price volatility.
Goldman said the timing of the volatility was behind more of the rally and easing in Western flows than Chinese speculation, noting that most of the tighter moves occurred when Chinese futures markets closed.
Silver price volatility has sparked meme-stock comparisons to video game retailer GameStop, which became a global phenomenon in 2021 after retailers rallied on Reddit in droves, sending its shares far above what traditional valuation models could justify.
Rhona O’Connell, Head of Market Research at StoneX, warned that the price had moved away from a stable level.
“Silver was highly valued and a self-fulfilling frenzy; however, it is volatile and its history is full of examples of price collapses,” he said. “Now it behaves like Icarus, and there is a high risk of other buyers getting burned to extend the analogy.”
Spot gold and futures They fell a little more than 1% to $4,887.03 and $4,887.40 an ounce, respectively.