Silver Plummets 27% From Peak Amid Rising Yields and Strong Dollar Pressure

Silver prices have retreated 27% from their peak, marking a significant correction in the precious metals market. The decline is reflected in the SPDR Gold Shares ETF (GLD), which has also seen reduced inflows, while the iShares Silver Trust (SLV) has lost nearly a third of its value since the high reached in early 2024. This downturn coincides with a sharp rise in U.S. 10-year real yields, now above 2.1%, which increases the opportunity cost of holding non-interest-bearing assets like silver. The strengthening U.S. dollar index has further pressured silver, as a stronger dollar makes commodities priced in dollars more expensive for foreign buyers. This dynamic has contributed to broad-based weakness across commodities, with crude oil (CL=F) experiencing sustained downward pressure as well, despite geopolitical tensions. The correlation between silver and oil has weakened, suggesting divergent market drivers at play. Market analysts note that silver’s sensitivity to industrial demand amplifies its vulnerability during macroeconomic tightening cycles. With global manufacturing PMI indices stagnating below 50 in Q1 2024, industrial consumption of silver—especially in solar panels and electronics—has slowed, reducing near-term demand pressure. This fundamental shift, combined with reduced speculative positioning, increases the risk of further downside. The broader implications include potential reassessment of inflation expectations and portfolio reallocations out of precious metals. Investors monitoring commodity baskets and inflation hedges may shift toward real assets with more stable cash flows, affecting ETF flows and futures positioning across materials and financial sectors.