Silver Prices Slump Amid Geopolitical Tensions and Tightening Monetary Policy

Silver prices dropped to $58.77 per ounce on Thursday, down 1.59% from the previous session. The decline is a result of conflicting market forces, with geopolitical risk premiums pushing up inflation expectations and strengthening the case for tighter monetary policy.

The Federal Reserve's potential rate hike in September has increased investor anxiety, which led to silver's retreat from its highest level since July 10.

COMEX warehouses reported a total of 330.3 million ounces of silver as of July 22, with only 96.3 million ounces classified as 'registered' and eligible for delivery against futures contracts.

The structural deficit in the silver market persists, with the Silver Institute predicting a shortfall of 46.3 million ounces in 2026.