Jobs Data and Geopolitical Calm Trigger 37% Weekly Rout in Triple-Leveraged Silver ETC

The perfect storm of a strong US labor market and a sudden easing in Middle East tensions has slammed the WisdomTree Silver 3x Daily Leveraged ETC, erasing more than a third of its value in just seven trading days. The product tumbled 12.14% on Tuesday alone to close at $10.75, pushing its weekly loss to a staggering 37%, according to the most recent data. Just a day earlier, it had settled at $12.23 after a 28.39% weekly slide.

The leveraged vehicle, which amplifies daily moves in the silver price by a factor of three, is suffering from the toxic combination of rising bond yields, a stronger dollar, and the evaporation of the geopolitical risk premium. With annualized volatility hovering near 128%, the compounding effect of daily resets is punishing holders during the steep downtrend. The fund, which oversees roughly EUR 330 million in assets, depends on a swap structure with BNP Paribas as its central counterparty.

Rate repricing accelerates after payrolls beat

The sell-off was triggered by a stronger-than-expected US jobs report that showed 172,000 new positions created, handily outpacing forecasts. That data fueled a sharp repricing of interest rate expectations. Traders now assign a 40% probability to a rate hike in December, up from just 14% a month earlier. Meanwhile, the odds of a move by the end of 2026 have jumped to 72%, according to the primary article. Higher yields reduce the appeal of non-yielding assets like silver, and the ETC’s leverage magnifies the pain.

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The geopolitical backdrop has shifted as well. A ceasefire between Iran and Israel, confirmed by US President Donald Trump, has removed the safe-haven bid from precious metals. Silber briefly spiked to historic highs above $100 an ounce during the height of tensions, but has since retreated to the $67–68 support zone. A weekly close in silver futures below $65.41 could trigger a further wave of selling, technical analysts warn.

CPI report looms as next catalyst

All eyes are now on Wednesday’s US consumer price index release for May. Economists at RBC Economics expect a monthly gain of 0.5%, which would push the annual inflation rate to 4.2%. Such a hot reading would likely reinforce the hawkish rate outlook and keep the leveraged product under pressure. The core CPI already ran hot at nearly 3% in April, surprising to the upside. If inflation comes in softer, the battered ETC could find some temporary relief. Producer price data follows on Thursday.

Silver’s dual identity as both a monetary metal and an industrial commodity adds another layer of vulnerability. The slowdown in global growth expectations—particularly for sectors like solar panels, electric vehicles and artificial intelligence—is damping demand for the metal’s industrial applications. Even the persistent supply deficit in the silver market is being overshadowed by macro concerns.

Long-term target remains in place

Despite the current rout, the Citigroup maintains a silver price target of $110 an ounce for the second half of 2026. For the ETC to capitalise on such a recovery, the interest-rate headwinds would need to fade first. In a separate move, WisdomTree is adjusting its internal cost structure: from early September, the daily swap rate will be lowered from 0.01248% to 0.00692%, potentially reducing the product’s long-term drag on returns when markets stabilise. For now, the next inflation print will decide whether the bleeding stops or the next leg down begins.

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