What Wall Street Is Saying About the Big Drops in Metals Prices Today

A violent selloff Friday sent silver prices crashing and gold futures to their biggest one-day dollar decline on record, the latest twist of wild trading that has left precious metals swinging like meme stocks.

The declines began around the time reports suggested that President Trump would nominate former Federal Reserve governor Kevin Warsh to succeed Jerome Powell as chair of the central bank. Warsh historically has been more concerned with higher inflation than slower growth, soothing Wall Street fears that the Fed would succumb to Trump’s push to lower interest rates.

Warsh “is coming with hawkish credentials,” said Dec Mullarkey, managing director of SLC Management. “That lowers the risk of debasement across the currency. You’re returning to an orderly monetary approach.”

Analysts suggested fast-money traders taking profits at month’s end or banks shielding themselves from the impact of sudden declines could have also lent momentum to the selloff. “I’ve been in the market for 20 years. I’ve never seen anything quite like this market,” said Adrian Ash, director of research at BullionVault. “It’s easy to look at gold and silver and say this is a retail mania,” but “there is no retail participation in base metals,” where copper also fell sharply Friday.