Silver closed out its fifth consecutive losing streak on Friday with a modest bounce, but the metal remains deep in the red. Spot prices ranged between $67.45 and $68.13, depending on the data feed, while July futures surged 5.5% after a sudden ceasefire announcement from Washington. Yet that short-lived rally did little to alter a grim picture: silver has shed more than 44% from its January all-time high of $121.78, with a 24% monthly loss that has pushed the relative strength index to 40.7—still short of oversold territory.
The Friday spike came after President Trump halted further airstrikes against Iran, declaring an end to hostilities. The move raised hopes for a renewed diplomatic track on the nuclear program, reopening the prospect of an eventual deal that could ease energy-market tensions. But no final agreement has been signed, and the fragile truce offers only a temporary reprieve. The underlying macroeconomic headwinds remain firmly in place, and the next catalyst for the market is already on the horizon: the Federal Open Market Committee’s two-day meeting beginning June 16, followed by the first press conference from newly appointed Fed chair Warsh.
The rate environment is the most aggressive counterweight to silver’s appeal. A blowout US jobs report showed 172,000 new positions in May—double expectations—crushing any near-term hopes for dovish pivot. Goldman Sachs has scrapped all rate-cut projections for 2026 and now sees the first reduction no earlier than June 2027. The CME FedWatch Tool assigns a 99.4% probability that the Fed will hold the federal funds rate at 3.50%–3.75% at the June meeting. In Europe, the European Central Bank raised its deposit rate to 2.25%, while US producer prices surged 6.5% year-on-year in May. Rising Treasury yields and a strong dollar directly inflate the opportunity cost of holding a non-yielding asset like silver, and the metal’s 30-day loss of nearly 24% reflects that pressure.
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Industrial demand, which now accounts for 57% of annual silver consumption—up from half five years ago—is a mixed story. The photovoltaic sector, the largest industrial buyer, is actively substituting silver as costs climb. Silver now represents up to 29% of module costs per watt, and the World Silver Survey reported a 6% decline in solar-related demand in 2025 to 186.6 million ounces. Metals Focus projects a further 19% drop to about 151 million ounces in 2026, while BloombergNEF estimates a 7% decline to 194 million ounces—this despite a 15% expansion in global solar capacity. Silver usage per cell is falling as manufacturers turn to cheaper alternatives. On the other side, demand from artificial intelligence, electric vehicles, and data centers is surging, partially offsetting the solar drag. The net effect is a structural shift rather than a collapse, but it has removed one pillar of support.
The supply side tells a different story. The Silver Institute projects a sixth consecutive global deficit in 2026, with a shortfall of 46.3 million ounces following a 40.3 million ounce deficit in 2025. Since 2021 the cumulative deficit has exceeded 760 million ounces. COMEX inventories have fallen almost 40% in recent months to about 315 million ounces. That physical scarcity provides a floor, but it has not been enough to reverse the bearish sentiment. The gold-to-silver ratio now stands at 63, up more than eight points in a month. Historical averages range from 65 to 75, and readings above 80 are typically seen as signals that silver is undervalued. With the 50-day moving average hovering near $76, the metal faces a massive resistance zone that will require a macroeconomic or geopolitical catalyst to break. The FOMC decision next week may deliver that—or deepen the rout.
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