Silver Drops 22% in Q2 as Fed, Dollar and Options Unwind Trigger 2011-Scale Slide
Updated
Updated · Kitco NEWS · Jul 15
Silver Drops 22% in Q2 as Fed, Dollar and Options Unwind Trigger 2011-Scale Slide
1 articles · Updated · Kitco NEWS · Jul 15
Summary
$16.57 an ounce was wiped off silver in the quarter ended June 30, a 22.04% fall and its worst quarter since the first quarter of 2020, with June marking the biggest monthly drop since September 2011.
Hawkish Fed rate increases, a stronger U.S. dollar and the unwinding of oversized options bets drove the selloff, which Sprott's Paul Wong said looked like capitulation after silver broke key support levels.
Sprott argues the drop has not changed silver's structural bull case because the market has run supply deficits for seven or eight years and is likely to keep doing so for another seven or eight.
Industrial demand from solar, EVs, electrification, AI infrastructure and defense, along with rising monetary demand and tight physical inventories, is seen supporting prices even as silver remains more volatile than gold.