Gold Silver Crash Reason explained: Find out how Donald Trump’s key Fed move sparked panic selling, crashing gold and silver prices and shaking global bullion markets.
The bullion market was celebrating just days ago. Gold and silver were trading near record highs, investors were betting big on a weaker dollar, and optimism ruled the sarrafa market.
Then, suddenly, everything changed.
Silver plunged sharply in a single session, while gold followed with a brutal correction. What looked like a routine pullback quickly turned into a full-blown crash.
So, what really happened?
Let’s break down the Gold Silver Crash Reason step by step.
- Gold Silver Crash Reason: What Happened to Prices in Delhi and Across India?
- Why Did Gold and Silver Suddenly Collapse?
- How Donald Trump Wrote the Script of This Crash Days Earlier
- Gold Silver Crash Reason: Why Kevin Warsh Spooked the Bullion Market
- Margin Calls, Leverage, and CME Group’s Role in the Selloff
- What Happens Next? Outlook for Gold and Silver
Gold Silver Crash Reason: What Happened to Prices in Delhi and Across India?
According to the All India Sarafa Association, precious metals continued to slide on Monday:
- Silver dropped for the third straight session, crashing by nearly ₹52,000 to around ₹2.60 lakh per kg. From its January 29 peak, silver has now fallen close to 36%.
- Gold (99.9% purity) slipped by about ₹12,800, settling near ₹1,52,700 per 10 grams.
This sudden selloff shocked retail buyers as well as large investors, especially after both metals had touched historic highs just days earlier.
Why Did Gold and Silver Suddenly Collapse?
Market experts point to a perfect storm of negative triggers:
- A stronger US dollar
- Ongoing tariff negotiations initiated by Donald Trump
- Cooling tensions between the US and Iran
- Speculation around the next chair of the Federal Reserve
- No change in gold and silver import duties in India’s Union Budget 2026–27
However, the biggest shock came from Washington.
How Donald Trump Wrote the Script of This Crash Days Earlier
The dramatic fall on January 30 didn’t come out of nowhere.
Its groundwork was laid on January 27.
From the White House, President Donald Trump signaled his choice for the next Federal Reserve Chair — a move that instantly rattled global financial markets.
Trump put forward Kevin Warsh as the leading candidate.
Until then, traders were expecting an “ultra-dovish” pick — someone likely to slash interest rates aggressively and tolerate higher inflation. That scenario would have been highly bullish for gold and silver.
Warsh, however, represents the exact opposite.
Gold Silver Crash Reason: Why Kevin Warsh Spooked the Bullion Market
Kevin Warsh is widely seen as a policy hawk — tough on inflation and supportive of a strong dollar.
In simple terms:
- Higher interest rates
- Tighter monetary policy
- Less cheap money in the system
All three are traditionally bad news for precious metals.
The moment Warsh’s name surfaced, markets realized that easy liquidity might not last.
The result?
- Silver crashed nearly 26% in a single day
- Gold dropped close to 9%
Prices that were flirting with $5,600 per ounce for gold and $120 per ounce for silver suddenly collapsed as panic selling kicked in.
Margin Calls, Leverage, and CME Group’s Role in the Selloff
The fall wasn’t driven by sentiment alone.
Many traders were heavily leveraged, betting borrowed money on rising prices. Once metals started slipping, margin calls forced investors to liquidate positions.
To make matters worse, CME Group raised margin requirements on gold, silver, and platinum contracts.
That move poured fuel on the fire.
Speculators were left with no choice but to cut positions, accelerating the crash even further.
What Happens Next? Outlook for Gold and Silver
Despite the violent correction, not everyone believes the bull run is over.
Global banking giant JPMorgan Chase says the story may still have another chapter.
According to its analysts:
- Central bank buying remains strong
- Geopolitical risks haven’t disappeared
- Gold could climb toward $6,300 per ounce by year-end
- Silver is now seen finding strong support in the $75–$80 zone
Still, experts warn that volatility will remain high in the sarrafa market over the coming weeks.
The Gold Silver Crash Reason wasn’t just one headline or one policy move.
It was a chain reaction — Trump’s Fed signal, Kevin Warsh’s hawkish reputation, leveraged speculation, margin hikes, and profit booking — all hitting the market at once.
For investors, the lesson is clear: precious metals may be long-term hedges, but in the short term, they can swing violently on policy expectations alone.