Silver Price Recedes Sharply After US-Iran Tensions Ease: Why Silver's Volatility Far Exceeds Gold's?

As US-Iran tensions de-escalated, silver prices fell approximately 18% from their peak, while gold only declined by about 5.3%. This significant difference reflects silver's higher market sensitivity compared to gold. As a metal with both industrial and monetary properties, silver's relatively lower liquidity makes it more prone to sharp fluctuations when risk sentiment shifts.

During the escalation of the conflict, silver's intraday volatility reached as high as 15.8%, far exceeding gold's more stable movements. Market data showed that gold briefly surged to a record high of $5,417 per ounce, but as geopolitical risks subsided, its safe-haven buying quickly receded. Silver, on the other hand, faced greater selling pressure due to changing expectations for industrial demand.

Key factors supporting silver's long-term outlook include a multi-year supply deficit and strong industrial demand from sectors such as solar energy, electric vehicles, electronic devices, and artificial intelligence hardware. Some industry experts point out that although there are risks of demand pullbacks in the photovoltaic industry, overall industrial silver consumption is still trending upward. First Majestic Silver CEO Keith Neumeyer suggested that silver prices could potentially reach $100 per ounce. Achieving this target requires multiple conditions to be met: a long-term structural supply shortage, accelerated expansion of industrial demand, and significant easing in the global monetary system. However, a stronger dollar or higher real interest rates could still act as a drag on prices. Institutional analysis generally believes that war-induced risk premiums tend to quickly push up precious metal prices in the initial stages, but as the situation clarifies, market sentiment rapidly returns to fundamentals. Gold's surge in the early stages of the conflict confirmed this pattern, while silver, due to its dual properties, is more susceptible to changes in supply, demand, and liquidity, resulting in more dramatic price reactions.