A report issued by the Safe Haven Center revealed that silver prices in the local market rose by 36% during January trading, while global silver prices increased by 18%, despite the severe volatility that struck markets toward the end of the month following record-high levels in both local and international markets.
According to the report, local silver prices increased by EGP 45 during January. The price of 999-fine silver opened the month at EGP 125 per gram, touched a historic high of EGP 206, and closed the month at EGP 170. Globally, silver gained about $13 per ounce, opening trading at $72, peaking at $121, and ending the month at $85 per ounce.
The report noted that silver prices declined by around EGP 3 during last week’s trading. The price of 999-fine silver opened the week at EGP 173 per gram, reached EGP 206, and closed at EGP 170. On global exchanges, silver fell by approximately $18 per ounce, opening at $103, touching $121, and closing at $85 per ounce.
Prices of other grades showed 925-fine silver at around EGP 157.50 per gram, 800-fine silver at approximately EGP 136.25, while the silver pound stabilized at about EGP 1,260.
The report explained that the Egyptian market is witnessing rapidly growing demand for silver amid a clear shortage of raw material, which has pushed local prices above global levels. This has also led to extended delivery times due to mounting pressure on supply.
Local silver markets experienced violent price swings on Thursday and Friday in line with global movements, causing disruptions in order execution, particularly amid sharp downward moves. This resulted in a widening gap between local and global prices and exposed many buyers to significant losses, especially given the unprecedented surge in buying at elevated price levels.
The report advised investors who purchased silver at high prices to remain patient and wait for prices to recover, while adopting a gradual buying strategy to offset losses. Expectations remain positive for both gold and silver, supported by ongoing global uncertainty stemming from geopolitical tensions, fiscal policy risks, and persistent supply shortages—especially as silver’s role as a key industrial metal continues to expand, reinforcing demand.
Gold and silver prices collapsed sharply during Friday’s trading as investors moved to take profits following weeks of record gains. Silver’s decline was particularly severe, plunging by more than $40 per ounce, or 35%, to around $74, before paring some losses, then coming under renewed selling pressure near the close, ending the session at $85 per ounce—down 35.9%—marking the largest single-day drop in silver’s history.
The sharp decline came amid widespread profit-taking and a stronger U.S. dollar, compounded by U.S. President Donald Trump’s announcement that he had selected Kevin Warsh, former Federal Reserve governor known for his hawkish stance on interest rates, to chair the Federal Reserve.
Gold had previously approached $5,600 per ounce, while silver surpassed $121 per ounce earlier in the week, before markets entered a sharp correction following an extremely volatile Thursday session.
Warsh Nomination Dampens Rate-Cut Hopes
The selloff began during Asian trading hours following reports that the Trump administration intended to nominate Kevin Warsh as Federal Reserve chair, a move later confirmed. This development, combined with producer price index data coming in above expectations, supported the dollar and weakened bets on interest-rate cuts.
Christopher Wong, market strategist at OCBC Bank, said the correction was expected, noting that it “embodies the rule that rapid rallies are often followed by rapid declines,” adding that markets were “looking for an excuse to unwind near-vertical price moves.”
Commerzbank also said the magnitude of the pullback reflects profit-taking after rapid gains, while emphasizing that expectations for U.S. rate cuts remain intact—and may even be greater than current market pricing suggests.
Technical Signals and Forward Risks
According to Bloomberg analysis, technical indicators flashed clear warning signals, most notably the Relative Strength Index (RSI) for gold, which reached 90—its highest level in decades—indicating extreme overbought conditions.
Simon White, Bloomberg macro strategist, wrote that the silver-to-gold ratio has risen at a pace approaching levels last seen in the late 1970s, suggesting recent price action may represent a rejection point, even though gold and silver have not yet matched the full momentum of the 1979 cycle.
In this context, the Federal Reserve decided to keep interest rates unchanged within the 3.50%–3.75% range, affirming that the U.S. economy continues to grow despite heightened uncertainty.
Geopolitical risks remain elevated, following warnings from Iran that it would “defend itself and respond in an unprecedented manner” after renewed threats from President Trump. Tensions escalated further after the European Union designated Iran’s Revolutionary Guard as a terrorist organization. Reports also indicated increased U.S. military presence near Iran, alongside Iranian live-fire drills in the strategically vital Strait of Hormuz, raising concerns over regional security.
Silver has benefited from its role as a safe-haven asset amid declining confidence in U.S. assets, after President Trump downplayed the dollar’s slide to a four-year low while escalating tariff threats and criticizing the Federal Reserve.
For his part, Maximilian Layton, Global Head of Commodities Research at Citi, said silver remains well positioned for positive performance over the medium term, supported by geopolitical risks and declining confidence in U.S. monetary policy. He added that Citi has raised its three-month silver price forecast to $150 per ounce.
Despite the sharp pullback from record highs, the broader trend for silver remains bullish, underpinned by growing safe-haven demand and its expanding dual role as both a monetary and industrial metal—particularly amid rising use in renewable energy, electric vehicles, and electronics—providing strong long-term structural support.
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