Advisor Mustafa Al-Manea wrote: Why did gold and silver prices drop?<\/p>\n\n\n\n
In recent trading, gold and silver recorded their largest decline in decades, following a record-breaking surge that lasted from late 2025 into early 2026.<\/p>\n\n\n\n
After gold nearly reached $5,625 per ounce and silver hit historic levels above $120 per ounce, gold dropped by about 9\u201311% to between $4,745\u2013$4,901 per ounce, while silver fell even more sharply by roughly 30% to levels around $78\u2013$83 per ounce.<\/p>\n\n\n\n
This sparked strong reactions among investors in global markets and also raised concerns among non-investors who had turned to gold and silver as a safe haven for their savings.<\/p>\n\n\n\n
\u201cBased on inquiries from many colleagues and interested parties about the reasons behind this decline, I present in this article a brief overview of the main causes, written in simple language to make it easily understandable for everyone,\u201d Al-Manea said.<\/p>\n\n\n\n
Main Reasons for the Drop in Gold and Silver Prices:<\/strong><\/p>\n\n\n\n Markets saw this as a potential shift in interest rate policy, raising concerns about Fed direction, which triggered rapid selling of gold and silver. Although the new nominee is expected to follow Trump\u2019s push for lower rates, markets understood Warsh\u2019s past cautious approach to rates, his support for a strong dollar, and the complexity of rate-cut decisions at the Fed, reducing bets on gold and silver.<\/p>\n\n\n\n Conclusion<\/strong> About the Author<\/strong> <\/p>\n","protected":false},"excerpt":{"rendered":" Advisor Mustafa Al-Manea wrote: Why did gold and silver prices drop? In recent trading, gold and silver recorded their largest decline in decades, following a record-breaking surge that lasted from late 2025 into early 2026. After gold nearly reached $5,625 per ounce and silver hit historic levels above $120 per ounce, gold dropped by about […]<\/p>\n","protected":false},"author":13,"featured_media":256132,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[683],"tags":[858,613,1139],"class_list":["post-256131","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economic-articles","tag-gold","tag-libya","tag-silver"],"acf":[],"_links":{"self":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/256131","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/comments?post=256131"}],"version-history":[{"count":1,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/256131\/revisions"}],"predecessor-version":[{"id":256133,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/posts\/256131\/revisions\/256133"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/media\/256132"}],"wp:attachment":[{"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/media?parent=256131"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/categories?post=256131"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sada.ly\/en\/wp-json\/wp\/v2\/tags?post=256131"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n
The rise of gold and silver to record levels attracted widespread profit-taking by investors and funds, who began selling to secure their gains, increasing supply.<\/li>\n\n\n\n
Media reported that US President Donald Trump will select Kevin Warsh to chair the Federal Reserve after Jerome Powell\u2019s term ends in May 2026.<\/li>\n<\/ol>\n\n\n\n\n
Following Warsh\u2019s nomination, the US Dollar Index rose significantly, reducing the attractiveness of dollar-denominated gold and silver. At the same time, US bond yields increased, pushing investors toward higher-yielding assets compared to non-income-generating metals like gold and silver.<\/li>\n\n\n\n
Despite economic and geopolitical tensions that had supported metals\u2019 rise in 2025, market sentiment recently showed a relative drop in demand for safe assets like gold and silver, as markets anticipated that tensions may have peaked.<\/li>\n\n\n\n
Recent drops in tech stocks increased margin requirements (the mandatory collateral for trades), forcing many investors to sell gold and silver to free liquidity for brokers and lenders.<\/li>\n\n\n\n
Unlike gold, silver is widely used in electronics, solar energy, medicine, and other industries, making it more sensitive to economic growth expectations. Combined with falling tech stocks, this led silver to drop more sharply than gold.<\/li>\n<\/ol>\n\n\n\n
The recent fall in gold and silver was not a \u201cnormal dip\u201d but a sharp correction after an unprecedented surge. The decline was driven by psychological and technical market factors, alongside major economic policy shifts. While markets remain unpredictable, the strength of the US dollar\u2014up or down\u2014remains one of the clearest influences on gold and silver prices.<\/p>\n\n\n\n
Mustafa Al-Manea is a Libyan lawyer and legal-economic expert with over 24 years of experience. He has worked with investment institutions, sovereign funds, and banks globally and in Libya. He has served as an advisor to the Governor of the Central Bank of Libya, chaired and participated in several central bank executive teams, and is a board member of the Libyan Investment Authority and Libyan Foreign Bank. He has represented Libya in World Bank and IMF meetings, led the Prime Minister\u2019s strategic initiatives team, and lectured with the American Bar Association. He is also a member of the European Lawyers Association and the Libyan-American Council for Trade and Investment, with numerous publications and bold views on economic and financial transformation.<\/em><\/p>\n\n\n\n