Silver Declines Locally Amid Sharp Global Volatility and Dollar Pressure

Silver prices in the local market declined during Saturday’s trading, coinciding with the weekly closure of global exchanges, following a week marked by sharp fluctuations in the ounce price due to dollar strength and intensified profit-taking, according to a report issued by the “Safe Haven Center.”

The report noted that the price of 999 silver fell by around EGP 13 to record EGP 137 per gram. Globally, silver slipped by about $1 over the week to close at $78 per ounce, after briefly touching the $80 level.

Silver 925 was priced at approximately EGP 127 per gram, while 800 silver stood near EGP 110. The silver pound coin remained stable at EGP 1,016.

External Pressures and Broad Selling Wave

Globally, silver faced heavy selling pressure following previous gains, as the U.S. dollar received support from stronger-than-expected U.S. jobs data. This reinforced expectations that monetary tightening may persist, reducing the appeal of non-yielding assets.

A broad selloff in technology stocks—driven by valuation concerns in the artificial intelligence sector—combined with margin calls, further intensified pressure on precious metals.

These factors collectively led to a drop of more than 11% in a single session, pushing silver down to around $76.60 in Asian trading before it recovered part of its losses.

Analysts suggest that continued strength in U.S. inflation or the Federal Reserve maintaining interest rates at elevated levels for longer could trigger further downside in silver, particularly as markets price in a high probability of a rate hold at the upcoming meeting. Meanwhile, the likelihood of a rate cut in June is hovering near 50%, according to the CME FedWatch Tool.

Negative Weekly Performance and Inflation Data in Focus

Despite posting modest gains on Friday after rebounding from recent lows, silver recorded its third consecutive weekly loss, as prior gains were eroded by successive waves of selling and deteriorating investor sentiment.

Investors are now awaiting the release of U.S. Consumer Price Index data, given its direct impact on rate-cut expectations.

A slowdown in inflation could weaken the dollar and support precious metals, while persistently elevated readings may reinforce the scenario of prolonged high interest rates, limiting silver’s recovery.

Sharp Correction After Record Rally

The report indicated that silver’s nearly 20% retreat from its recent peak followed a strong rally of 47% in January, which triggered intensive profit-taking.

Tighter monetary expectations and higher margin requirements on global exchanges also forced leveraged traders to liquidate positions.

In the same context, gold fell below $5,000 per ounce during Thursday’s trading before rebounding above $4,900, amid selling to cover losses in other asset classes.

Precious metals had posted substantial gains last year, with gold rising about 40% and silver surging 160%, leaving them vulnerable to sharp corrective moves.

Oversold Conditions vs. Buying Opportunities

Holding current February levels will be a key short-term test for silver. Although oversold conditions may pave the way for a technical rebound, price direction will remain dependent on several factors—most notably the trajectory of the U.S. dollar, Federal Reserve policy decisions, and industrial demand, particularly from the solar energy and 5G network sectors.

Over the longer term, analysts believe the sharp pullback may represent an opportunity to gradually build investment positions, supported by strong structural demand from solar panel manufacturing, electric vehicles, and electronics. However, they caution that volatility is likely to remain elevated in both directions and recommend prudent risk management through portfolio diversification and dollar-cost averaging rather than chasing rapid price moves.

In summary, silver remains caught between U.S. monetary policy pressures and dollar strength on one side, and long-term industrial and investment support on the other, within a market highly sensitive to shifts in macroeconomic conditions.