Precious metal prices hit a new high in January, but have since plummeted.
Silver outperforms gold as prices soar to unprecedented heights
With metals markets reaching unprecedented levels globally this year, silver prices have risen much faster than gold, capturing the attention of investors.
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Silver prices reached record levels in 2026, only to rise quickly. We’re only a month into this year, but we’re already seeing quite a bit of volatility when it comes to the price of silver. And as the economy and markets face considerable uncertainty going forward, investors may continue to add to precious metals as the year progresses.
Silver hit a new all-time high of over $121 an ounce in January. The big question is whether the stock will rise further this year, perhaps to $200; iShares Silver Trust (NYSEMKT: SLV) Good move so far. We aim to answer those questions below.
What caused the price of silver to collapse?
Silver prices plummeted more than 30% on January 30th, the worst single-day performance in decades. The reason for the sudden and rapid decline was President Trump’s announcement that he would nominate Kevin Warsh to be the next chairman of the Federal Reserve Board. The move appeared to have the potential to soothe the broader market regarding the Fed’s independence, helping the US dollar rise, but had the opposite effect on silver prices.
As of February 3, silver was trading at around $88 per ounce, a significant drop from recent highs. What this seems to suggest is that metal prices may be closely tied not only to the stock market and the broader economy, but also to investor confidence in the Fed’s independence.
Silver prices rose as investors grew concerned about who would replace Jerome Powell. Now that stability appears to have increased, investors are starting to exit safe-haven assets. But despite the volatility, iShares Silver Trust is up more than 12% year-to-date, which is better than the stock price at the beginning of the year. S&P500 And the profit is only about 2%.
Could silver prices rise in 2026?
Whether silver returns to its previous highs and rises further will likely depend not only on market sentiment, but also on how investors feel about the incoming Fed leadership. I think silver could rise again given retail investors’ interest in silver stocks and related investments, as concerns about the economy could increase demand for safe-haven assets.
So I wouldn’t be surprised if it reached $200 because of the potential hype and excitement from retail investors and the overall strength that they have. But I don’t think so either expect This is happening simply because of the heat in silver over the past few months, and the economic slowdown is probably much slower. The iShares Silver Trust is a good investment to own as a way to diversify your portfolio, but you should get used to the volatility that comes with it.
David Jagielski, CPA has no position in any stocks mentioned. The Motley Fool has no position in any stocks mentioned. The Motley Fool has a disclosure policy.
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