Shares of iShares Silver Trust slid to $56.10, a 4.8% decline, as a risk-off wave swept through precious metals ahead of Thursday's crucial PCE inflation report — the Federal Reserve's preferred price gauge. The drop extends a punishing streak that has erased more than 11.6% from SLV's value in just six trading sessions, turning what had been a strong 2026 for silver into a sudden test of investor conviction. Silver Sinks to $56 as Rate-Hike Fears and Iran Tensions Collide — Has the Metal's Historic Rally Finally Broken?
Shares of iShares Silver Trust plunged 4.8% to $56.10 in pre-market trading Monday, extending a brutal slide that has wiped 11.6% off the ETF in just six sessions. The selloff captures a painful reality for silver holders: a metal that pays no income is especially vulnerable when interest rates threaten to rise, and right now, the market is bracing for exactly that.
The Fed's Hawkish Turn Is Crushing a Metal That Earns Nothing. Silver has been weighed down by expectations of tighter monetary policy after the Federal Reserve left rates unchanged last week while adopting a more hawkish tone; nine of the Fed's 19 policymakers now anticipate at least one rate increase this year, with investors pricing in a potential hike as soon as September.
The latest PCE index — the Fed's preferred inflation gauge — rose 3.8% in April, with core PCE at 3.3%, well above the 2% target. Thursday's May PCE reading could either ease or intensify those fears. For SLV holders, every basis point of expected tightening raises the cost of owning a non-yielding asset versus bonds or savings accounts.
Silver Has Fallen Over 50% From Its January Peak. Silver was trading above $92 per ounce in late February, days before U.S. and Israeli strikes on Iran began on February 28; the metal had hit an all-time high of $121.785 in January.
Silver is falling not because geopolitical risk has disappeared, but because of what the Iran conflict is doing to inflation expectations.
May CPI came in at 4.2% year-over-year — the highest since April 2023 — with energy driving over 60% of the monthly gain. War-driven oil prices are feeding inflation, which feeds rate-hike bets, which punish silver — a vicious loop.
Long-Term Supply Shortages Haven't Stopped the Bleeding. The Silver Institute has tracked five consecutive years of global supply deficits, with a sixth expected in 2026.
J.P. Morgan sees silver averaging $81/oz this year , and the LBMA analyst survey shows an average forecast of $79.57/oz. Those targets sit 40%+ above today's price, but they hinge on rate expectations softening — something Thursday's data could delay further.
Thursday's PCE Print Is the Next Make-or-Break Moment. The path forward for silver is unusually binary: if the Iran conflict de-escalates and energy prices pull back, the rate-hike narrative collapses and silver's industrial demand case reasserts itself quickly. If PCE runs hot, a return to $70 support — or lower — is on the table. SLV holders are effectively making a bet that inflation will cool before the Fed acts. Right now, the market is voting the other way.