Consecutive 8 Trading Days of Decline... Gold at $4,800, Silver at $76, ETFs Also Enter Synchronized Adjustment Phase

Gold prices have declined for eight consecutive trading days, falling to the mid-$4,800 per ounce range. On the 18th (local time), spot gold (XAU/USD) closed at $4,836.86 per ounce, and on the early morning of the 19th, it traded near $4,845.30. After reaching nearly $5,238 on the 10th of this month, gold experienced a high point correction and fell below the $5,000 level, continuing to show weakness. Silver (XAG/USD) closed at $75.70 per ounce on the 18th and is currently fluctuating around $76.32. After rising close to $90 in early March, silver’s decline has widened, with increased volatility.

Recently, gold and silver are both undergoing synchronized adjustments, but their speed and magnitude of decline differ. Gold, as a safe-haven asset, has a stronger attribute for responding directly to central bank demand, interest rates, and exchange rates. Silver, being a precious metal with significant industrial demand from solar energy, electronics, and other sectors, is viewed as more sensitive to manufacturing sector health and re-inflation discussions (price increases driven by economic stimulus). Since the beginning of this month, both metals have retreated from their highs, but silver’s intraday high-low price range is larger, indicating volatility closer to risk assets.

In the New York stock market, the representative gold ETF—SPDR Gold Shares (GLD)—closed at $444.74 on the 18th, about 6% lower than the $472.53 close on the 9th, within a week. Even at the intraday low, it fell to the mid-$440s, showing that the decline in spot gold prices is quickly reflected in the ETF. The silver ETF—iShares Silver Trust (SLV)—also dropped from the $78 range to the lower $68 range, showing a downward trend. With both trading volume and turnover increasing, the market interprets this as active position adjustments by both buyers and sellers during this recent price correction, reflected in ETF prices.

On the macro front, factors such as central bank gold purchase policies, changes in U.S. monetary policy, and policy risks under the Trump administration form the background for price formation. Central banks in emerging markets like China, Russia, and India continue to expand gold reserves to reduce reliance on the dollar; since 2022, their net annual purchases have consistently exceeded 1,000 tons. Some countries, including Poland, have announced plans to increase gold reserve targets, highlighting structural demand factors. Meanwhile, the Federal Reserve has lowered the 2025 year-end federal funds rate target to 3.75-4.00%, with discussions of further rate cuts in 2026. A weaker dollar and declining U.S. Treasury yields are seen as factors limiting gold price declines. However, if fiscal expansion and re-inflation scenarios under the Trump administration materialize, markets expect the Fed might halt rate cuts or resume tightening, leaving uncertainty around the future rate path.

Looking at spot prices and ETF trends together, the reaction speeds of physical demand and financial investment demand differ. Central bank purchases and other physical demand tend to form relatively long-term trends, while GLD and SLV prices reflect daily changes in overall market risk appetite, interest rate expectations, and exchange rate fluctuations. Although both spot and ETF prices have been weak over the past week, ETF intraday volatility and trading volume have increased more significantly, indicating rapid position adjustments mainly by short-term investors.

Overall, gold and silver prices are in a correction phase characterized by a mix of defensive sentiment and cautious waiting. After being pressured near historic highs, profit-taking has continued, but central bank gold buying and geopolitical uncertainties are often cited as factors buffering downward pressure. Notably, market analysis suggests that gold, due to its safe-haven nature and role as a portfolio diversifier, remains in a stage of price adjustment and revaluation rather than a sharp trend reversal.

In the silver market, expectations for industrial demand and re-inflation discussions are intertwined, leading to more confusing directional signals. Market interpretation indicates that even during recent corrections, SLV trading volume remains high, reflecting ongoing interest in silver as an industrial demand and inflation hedge tool, beyond short-term price movements. However, due to larger price swings compared to gold, silver is more sensitive to supply-demand changes and macroeconomic variables.

Gold and silver are structurally classified as assets highly sensitive to interest rates, exchange rates, central bank policies, and geopolitical risks. The market consensus is that, based on U.S. monetary policy directions, dollar strength or weakness, major central bank gold purchase strategies, and geopolitical events such as wars and sanctions, significant short-term price volatility is likely.