Silver tumbles after Trump holds off on critical mineral tariffs

Singapore – Silver retreated on signs investors took profits following a blistering rally and as the US held off from imposing import tariffs on critical minerals.

The white metal fell as much as 7.3 per cent on Jan 15 after hitting an all-time peak of US$93.7515 earlier. That followed a surge of more than 20 per cent over the previous four sessions. Gold also declined. 

US President Donald Trump said he would negotiate bilateral agreements to ensure adequate supplies of critical minerals, floating price floors but not ruling out levies. Fears that tariffs would be imposed have kept some supplies, including silver, in US warehouses, which contributed to a global short squeeze in 2025 and has continued to aid prices into 2026.

Silver outpaced gold to jump almost 150 per cent in 2025, with some investors rotating into it after its yellow peer became too expensive. Silver also benefits from industrial demand, particularly from the solar industry where it is used in panels, while a speculative buying frenzy in China has added to the upward momentum in recent weeks. 

The medium-term narrative for silver remains firmly constructive, underpinned by supply shortfalls, industrial consumption and spillover demand from gold, said OCBC Bank strategist Christopher Wong. However, “the velocity of the recent moves warrants some near-term caution”, he said.

Gold and silver were beneficiaries of a broad rush into commodities this week that drove the precious metals to record highs, along with tin and copper. The Trump administration’s renewed attack on the Federal Reserve has buoyed prices and revived the “sell America” trade. The US’ capture of Venezuela’s leader and repeated threats to take Greenland, as well as the precarious situation in Iran, are also contributing to haven demand. 

“Much of what traders see on the screen reflects forced flows, margin dynamics, option hedging and short covering rather than genuine supply-demand price discovery,” Mr Ole Hansen, head of commodity strategy at Saxo Bank, said in a social media post. “In this environment, technical levels lose reliability, stops are easily triggered, and even correct macro views struggle to survive short-term noise.”

Traders had been closely watching the outcome of a US Commerce Department probe on whether imports of the metal and other critical minerals threatened national security. 

Mr Trump’s decision to hold off on import tariffs “suggests the administration will take a more surgical approach in making future decisions”, Mr Daniel Ghali, a senior commodity strategist from TD Securities, said in a note. That “significantly alleviates the fear of a broad-based approach that could have inadvertently impacted the underlying bars that underscore benchmark metals prices”, he said. 

Silver fell 6 per cent to US$87.7795 an ounce as at 1pm in Singapore. Gold declined 0.7 per cent to US$4,591.51. Platinum and palladium also dropped by more than 2 per cent.

Gold’s rally has legs beyond January, according to the latest Markets Pulse survey. While silver and copper have hit similar milestones, there are signs that flows into these metals are wavering as investors weigh the longevity of supply constraints. BLOOMBERG