Silver fell to $31 per ounce on Friday, marking its lowest level since January 29th and capping a brutal week with losses exceeding 9%. The sharp decline came amid mounting fears of a global economic slowdown, triggered by the rapid escalation in trade tensions between the world’s largest economies.
Silver tumbles on trade war and demand concerns
On Friday, China’s finance ministry announced sweeping 34% tariffs on all U.S. imports effective April 10, in direct retaliation for a new round of U.S. duties introduced by the Trump administration earlier this week.
President Trump unveiled a comprehensive 10% baseline tariff on all imports Wednesday, with elevated rates targeting key trade partners—54% on Chinese goods, 20% on European Union exports, 24% on Japanese products, and 27% on Indian imports. The aggressive move has sparked a wave of uncertainty across global markets, with equities and commodities bearing the brunt of the selloff. Industrial metals like silver, which are sensitive to manufacturing activity and economic growth, have been particularly vulnerable as investors brace for a potential recession.
Silver mantains safe-have appeal
However, while silver’s role as an industrial commodity has weighed heavily on its price this week, its dual status as a safe-haven asset could offer renewed support in the near term. As risk appetite fades and expectations for monetary easing grow, analysts suggest that silver may rebound alongside gold if central banks, particularly the Federal Reserve, move to cut interest rates. Traders are now pricing in an increasing likelihood of rate cuts beginning as early as June, hoping monetary support will offset some of the damage from trade disruptions.
In the broader market context, a shift in investor flows was evident, with capital moving into U.S. Treasuries, pushing yields lower across the curve. If recession fears deepen and inflationary pressures persist due to tariff-related cost pass-throughs, silver may eventually benefit from its inflation-hedging characteristics—despite its current short-term weakness.
