The signal for the price drop was the statement by U.S. President Donald Trump about his intention to appoint Kevin Warsh as the head of the Federal Reserve. Warsh is known for his tough stance in the fight against inflation, which instilled confidence in the markets regarding the strengthening of the dollar. As a result, the American currency significantly strengthened, negatively impacting gold and silver, which are priced in dollars.
Moreover, this political factor coincided with an already overheated market. Over the past year, the price of gold has risen significantly, and silver has particularly attracted the attention of speculators, including investors from China. Precious metals were increasingly viewed not as a hedge but as a means of quick profit. When the sharp price drop began, market sentiment changed instantly: mass sell-offs in the absence of buyers led to a significant collapse.
