Silver's Two-Front War: Trade Disappointment and a Dollar Surge Trigger Back-to-Back Weekly Losses
Published on 05/17/2026 at 17:36 | Redaktion boerse-global.de
Silver has found itself caught between two powerful forces in recent weeks, and neither is offering any relief. A dashed trade truce after the Trump-Xi summit in Beijing was followed by a hawkish shift in Federal Reserve leadership and a string of strong US economic data. The result: two consecutive Fridays of heavy selling that have left the metal nursing wounds on both the industrial and monetary fronts.
On the most recent Friday, silver closed at $76.34 per ounce, shedding 10.53% in a single session and slipping below its 50-day moving average of $77.10. That rout came on the heels of an earlier Friday loss of 9.12% that had taken the price to $77.55. Over the respective weeks, the metal lost 5.60% and 4.10%, and in the latest month it is down 4.13% — though year-to-date it still holds a gain of 5.64%.
The initial blow was dealt by the lack of concrete results from the Trump-Xi meeting. Markets had priced in a deal that would ease supply chains and stabilize global trade, an especially important factor for silver given that roughly 60% of its demand comes from industrial sectors such as solar energy, electric vehicles and electronics. When only vague progress on tariffs and agriculture was announced, optimism evaporated and the price dropped sharply.
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That sell-off was then compounded by a leadership change at the Federal Reserve. Kevin Warsh took over the chair on May 15, replacing Jerome Powell, and is seen as an advocate of tighter monetary policy and a smaller Fed balance sheet. The prospect of higher real rates hit silver directly — the metal offers no interest income, so rising bond yields make it less attractive compared with yield-bearing assets. Stubborn US inflation figures for April reinforced this narrative, and some market participants now speculate about further rate hikes rather than cuts.
Just days later, a fresh wave of selling arrived on the back of robust US retail sales and higher consumer and producer prices. A stronger dollar made silver more expensive for non-US buyers, while the repricing of rate expectations raised opportunity costs once again. Gold also fell, but silver’s dual identity as both a precious and an industrial metal amplifies its sensitivity to such macro crosscurrents.
On the demand side, the solar industry — a longtime pillar of silver consumption — is beginning to show signs of thrift. Manufacturers are reducing the amount of silver per cell or testing copper-based alternatives. For 2026, solar demand for silver is estimated at roughly 194 million ounces, a drop of about 7%. While applications in AI infrastructure and e-mobility continue to support overall demand, the solar sector’s momentum is waning.
Technically, the area around the 50-day average remains a critical battleground. After the latest close at $76.34, the metal sits below the $77.10 mark, while the 100-day average at $82.73 (or $82.72 on another calculation) stands as the next major resistance. The week ahead is packed with data that could either extend the pressure or offer a reprieve: China releases April activity data on Monday, Japan’s GDP estimate comes on Tuesday, and Thursday brings preliminary PMI readings for major economies, followed by speeches from ECB and Fed officials on Friday. The FOMC minutes due on May 20 are also on watch — a hawkish tone would prolong the headwinds, while a balanced message could refocus attention on silver’s still-tight supply and robust industrial fundamentals.
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