Silver Plummets 4.8% as Gold Holds Ground Amid Precious Metals Sell-Off

Silver led the retreat in precious metals on Thursday, falling 4.8% against the U.S. dollar, while gold shed 1.9%. The XAG/USD pair dropped below $32.00 per ounce, marking its steepest one-day decline in three weeks. In contrast, XAU/USD briefly rebounded above $2,050, signaling a degree of safe-haven demand amid broader market volatility. The sharp divergence underscores a shift in investor sentiment toward metals with significant industrial applications. Silver, which has approximately 50% of its demand tied to electronics, solar panels, and industrial manufacturing, is more sensitive to economic slowdown concerns and rising interest rate expectations. Gold, by comparison, remains a primary store of value during periods of uncertainty. Market data shows speculative positions in silver futures have been increasingly bearish, with net short exposure rising by 12% over the past fortnight. Meanwhile, gold’s managed money holdings have stabilized, suggesting stronger institutional support. This dynamic has exacerbated silver’s downside momentum despite a modest recovery in broader equity indices. The move affects mining firms with heavy silver exposure, such as Pan American Silver and Fresnillo, whose shares declined 5.3% and 4.1%, respectively. Commodities trading desks have also adjusted allocations, reducing silver weighting in multi-asset portfolios. The imbalance could persist if macroeconomic indicators continue to signal weakening industrial activity.