Spot silver surges 3% in two hours, reaching a new high since 2012

On Thursday (June 5), spot silver prices surged rapidly after entering the European session, reaching a high of $35.82 per ounce, a level last seen in February 2012.

Monthly chart of spot silver prices

Specific market data showed that spot silver began to accelerate its upward climb around 15:00 Beijing time, rising from $34.44 to $35.82 within two and a half hours, with an intraday gain exceeding 3%. Year-to-date, silver prices have surged by over 23%.

One-minute chart of spot silver prices

In comparison, gold's gains were relatively mild. Spot gold rebounded by approximately 20% in the European session, currently trading at $3,385.74 per ounce, with an intraday gain of around 0.34%.

Analysts believe that amidst growing global economic and political uncertainties, precious metal prices, including silver, are being supported by safe-haven funds. The previous day, the US raised tariffs on imported steel, aluminum, and their derivative products from 25% to 50%.

The market is concerned that the US may adopt similar trade protection measures on metals such as silver, thereby boosting safe-haven and substitute demand for silver. Goldman Sachs futures trader Robert Quinn stated that the news of steel and aluminum tariffs triggered significant long position building in the silver futures market.

Analysts say that the trade war initiated by Trump has sparked concerns about a recession in the US and global economies, and due to the unpredictability of tariff policies announced by Washington, precious metals such as gold and silver have been regarded as the most favored safe-haven assets.

Two days ago, the Organisation for Economic Co-operation and Development (OECD) lowered its forecast for the US economic growth rate this year from 2.2% to 1.6%. The OECD report pointed out that even with some tariff measures suspended, the current tariff levels in the US are the highest since World War II.

The OECD report also forecasts global GDP growth of 2.9% for this year and next. Previous forecasts were 3.1% for this year and 3% for next year. The report mentioned that if factors such as rising trade barriers persist, growth prospects will be significantly negatively impacted.

Yesterday, data released by ADP showed that private sector employment in the US increased by only 37,000 in May, the lowest level since April 2023. After the data was released, Trump quickly posted urging Fed Chairman Powell to "cut interest rates now."

Later that day, the US May Services PMI released by ISM unexpectedly fell below the 50 mark to 49.9, the first time in nearly a year. The report also presented typical "stagflation" characteristics: business activity and new orders both plummeted, while the prices paid index surged to a 30-month high.

Affected by unfavorable data, market expectations for a US Fed interest rate cut pushed the US dollar index below the 99 mark. Ole Hansen, head of commodity strategy at Saxo Bank, said, "Gold, and especially silver, have broken through key technical barriers, with the most immediate catalyst being the sharp decline in the US dollar."

Hansen added that, at a deeper level, the resurgence of geopolitical risks and the rekindling of trade war concerns are also fueling the bullish momentum across the precious metals market.

Earlier this week, Robert Kiyosaki, author of "Rich Dad Poor Dad," posted on social media, "As I predicted in my 2013 book 'Rich Dad's Prophecy,' the biggest crisis in history is coming."

"The best deal now is silver. By 2025, the price of silver could triple," Kiyosaki specifically mentioned. "Tomorrow, I'm going to my local gold and silver dealer to exchange 'fake money' for real silver."