Unprecedented Gold and Silver Market Volatility Following Trump’s Remarks and Federal Reserve Decision
The global base metals market experienced one of its most unprecedented fluctuations within a 24-hour period, where gold and silver prices surged sharply before plummeting, leaving traders in shock.
Following these developments, on Thursday, global gold prices rose to $5,500 and silver to $120; however, just one day later, gold fell by over 10 percent and silver by more than 30 percent. This sharp decline highlighted the market’s extreme vulnerability to political and monetary signals.
Analysts attribute this intense volatility to a combination of political and fundamental factors. Among them were Donald Trump’s statements on Wednesday emphasizing increased pressure to cut interest rates in the U.S. and downplaying the significance of a weaker dollar. Simultaneously, rising central bank reserves in China, escalating geopolitical risks, and ongoing trade tensions contributed to a frenzied rally in the metals market.
However, the market’s trend quickly reversed. On Friday, the appointment of Coin Warsh as the next Chair of the U.S. Federal Reserve transformed the global economic outlook once again. Warsh supports contractionary monetary policies, opposes interest rate cuts, and views maintaining high rates as essential to controlling inflation.
According to market observers, this decision effectively eliminated hopes for a U.S. interest rate reduction in 2026, pushing markets into a state of deadlock and sharp decline. This situation once again underscored the decisive role of U.S. monetary policy in the global economy.
