Geopolitical Risks Pressure Silver Prices Down; Spot Trades Marginally Recover [SMM Daily Review]

Published: Oct 22, 2026 10:31 (GMT+8)

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[SMM Daily Review: Geopolitical Risks Pressure Silver Prices Lower, Spot Trades Marginally Recover] SMM, October 22: Tensions in the Middle East, combined with a macro vacuum period, kept precious metals under pressure and consolidating, with silver prices moving lower. Trading sentiment in the spot market recovered from yesterday, as end-user procurement and bill-related rigid demand were released. Some deals were struck at a discount of around 30 yuan/kg to the most-traded SHFE contract, but traders held prices firm while downstream buyers bargained, resulting in an overall weak recovery.

Today, SMM's 10:00 a.m. price for Ag (T+D) on the gold exchange is 13,800 yuan/kg, with a premium/discount range quoted at TD-5 to +10 yuan/kg and a weighted average price of 3.43 yuan/kg; against the most-traded SHFE 2612 contract, it is at a discount of 45-25 yuan/kg.

On the macro front, tensions in the Middle East remain elevated. Iran's foreign minister said there is currently no reason to see progress in negotiations, but if the US shows genuine willingness, Iran is willing to try the diplomatic path again. The US State Department confirmed it has ordered the evacuation of non-emergency US government employees and their families from Saudi Arabia, and later clarified that the "planned evacuation of some embassy personnel in the Gulf region" applies only to Saudi Arabia. As geopolitical conflicts escalate, precious metals remain under pressure. The market is currently in a macro news vacuum period and has entered a sideways consolidation phase ahead of next week's US Fed rate meeting.

In the spot market, the decline in silver prices helped improve trading sentiment today compared with yesterday. On the supply side, the basis widened, traders showed moderate willingness to sell, and they held prices firm with strong intent. Morning quotes in Shanghai were concentrated at a discount of 25-30 yuan/kg against SHFE 2612. As silver prices fell, end-user buying sentiment gradually picked up, and combined with some rigid demand for bill acceptance, some transactions were concluded near a discount of 30 yuan/kg against SHFE 2612. Smelter ex-works quotes remained near parity with TD, and downstream buyers mostly preferred to negotiate prices.

Overall, geopolitical risks and the macro news vacuum period kept precious metals futures under pressure and consolidating. In the spot market, stimulated by falling silver prices, end-user rigid demand and bill-related demand were released, and trading sentiment recovered marginally. However, with traders holding prices firm while downstream buyers negotiated, the market showed a weak recovery trend overall.

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