Silver Falls After Trump Holds Off on Critical Mineral Tariffs

Core Viewpoint - Silver prices experienced a significant pullback after reaching a record high, influenced by profit-taking and the US decision not to impose tariffs on critical minerals [1][3]. Group 1: Price Movements and Market Reactions - Silver prices fell as much as 7.3% on Thursday after a rally that saw prices increase by over 20% in the previous four sessions, peaking at $93.75 [1]. - The decision by US President Donald Trump to avoid broad tariffs on critical minerals, including silver, suggests a more targeted approach to trade measures, alleviating fears of widespread impacts on metal prices [3]. Group 2: Supply and Demand Dynamics - Approximately 434 million ounces of silver are currently held in warehouses linked to the Comex futures exchange in New York, which is about 100 million ounces more than a year ago, indicating a buildup of inventory due to tariff-related trade disruptions [3]. - Silver's price increase of nearly 150% last year was driven by strong industrial demand, particularly from the solar sector, and a shift in investor interest from gold to silver as gold prices rose [5]. Group 3: Future Outlook - The medium-term outlook for silver remains positive, supported by supply shortfalls, industrial consumption, and spillover demand from gold, although recent price volatility suggests caution in the near term [6]. - There is potential for some constraints in silver movement out of the US, as it remains on the list of critical minerals that could be subject to future trade measures [4].