Silver markets reeled as a blowout U.S. employment report obliterated expectations, sending the metal to its worst single-session loss in months and forcing investors to reconsider whether the Federal Reserve is anywhere close to cutting rates. Silver's 9% Crash on a Blockbuster Jobs Report: Is the Metal's Bull Run Over, or Just Taking a Breather?
Spot silver cratered on Friday after the U.S. economy delivered a jobs report that nobody saw coming, forcing a brutal repricing across precious metals and raising a pointed question: can the white metal's extraordinary rally survive a Federal Reserve that may raise rates instead of cutting them?
A Jobs Report That Doubled Expectations Rewrote the Rate Outlook Overnight
The May employment report showed the U.S. economy added 172,000 jobs, far exceeding the forecasted 85,000, while the unemployment rate held at 4.3% and annual wage growth came in at 3.4%. The reaction was immediate. Investors began betting on a Federal Reserve interest rate hike, with markets pricing in a quarter-point increase by year-end.
Rate hike odds surged to 67%, and the 10-year Treasury yield jumped to 4.54%. Higher rates make assets that pay no interest — like silver — less attractive relative to bonds and cash.
Silver Got Hit Harder Than Gold Because It Lives a Double Life
Silver fell $5.26, or 7.17%, closing at $68.57 per ounce, while gold dropped 3.27% to $4,339.61. Why the gap? Silver's steeper decline reflects its dual identity as both a monetary asset and an industrial commodity. Beyond monetary headwinds, silver faced additional pressure from deteriorating industrial demand sentiment as global equities posted their worst single-session decline since April 2025. When rate-hike fears collide with a stock-market selloff, silver gets squeezed from both sides.
The Longer-Term Supply Picture Tells a Different Story
The Silver Institute projects a 46.3-million-ounce deficit this year — up from 40.3 million ounces in 2025, a 15% widening — marking the sixth consecutive year the world consumes more silver than it mines.
Since 2021, roughly 762 million troy ounces have been drawn from above-ground stockpiles. Industrial demand from solar panels, EVs, and AI data centers hasn't flinched. Even after the selloff, silver prices are up more than 100% year to date.
The Fed's Next Move Is Now the Only Number That Matters
The probability of no hike sits at roughly 52%, with the Fed holding rates steady at 3.50–3.75% through mid-2026 amid core inflation near 2.7%.
The next FOMC meeting on June 16–17 — the first under incoming Chair Kevin Warsh — will be the next major catalyst. If inflation data next week runs hot, silver holders should brace for more pain. If it cools, Friday's plunge may look like a buying opportunity in a market where physical supply simply cannot keep up with demand.