Gold Holds Steady Below $3400 as Silver Slips Ahead of Fed Decision
Gold prices remained steady just under the $3400 mark on Wednesday, as investors awaited the U.S. Federal Reserve’s latest interest rate announcement and economic projections. Meanwhile, silver-backed exchange-traded funds (ETFs) saw a slight decline, with silver prices retreating below $37 per ounce after briefly touching new highs.
As geopolitical tensions continued to rise, former President Donald Trump made headlines with a provocative statement on social media: “We now have complete and total control of the skies over Iran,” he wrote, confirming U.S. military involvement in Israel’s ongoing strikes and threatening Iran’s Supreme Leader.
At the same time, Wall Street opened on a positive note, anticipating the Fed would hold rates steady for the sixth consecutive month, maintaining a ceiling of 4.50%. Gold hovered in a $30 range below its record high set eight weeks ago.
Silver also posted a notable performance, hitting a fresh 13-year high during London trading before falling back by 30 cents. This marked a return to levels not seen since early 2012. Historically, silver surged from $37 to its all-time high of $50 in under a month both in 1980 and again during the 2011 rally.
“This latest breakout above $35 was largely speculative, driven by futures markets,” said Daniel Ghali, director of commodity strategy at TD Securities. “There’s no clear macroeconomic catalyst behind the recent surge.”
Indeed, trading volumes for July silver futures on the CME’s Comex exchange surged to the highest since June 5, when prices first pushed through $35.
In contrast, silver ETF holdings began to waver. The iShares Silver Trust (NYSEArca: SLV), the largest silver ETF, reversed recent inflows and fell back to 14,675 tonnes—equivalent to 55% of global annual mine output. This reversal comes after reaching a six-month high when silver was trading over a dollar lower.
The second-largest silver ETF, the Sprott Physical Silver Trust (NYSEArca: PSLV), reported a modest 18-kilo adjustment to its 5,944-tonne holdings, continuing a trend of limited inflows in recent sessions. Still, the PSLV is up 5.8% in 2025 to date.
Silver has risen 26.1% in U.S. dollar terms so far this year, with 42% of net ETF inflows occurring in June alone, according to Rhona O’Connell, precious metals strategist at StoneX. However, she noted a lack of retail investor activity, citing oversupply in industrial silver demand, particularly in solar manufacturing.
Elsewhere in the markets, the U.S. Dollar Index (DXY) edged slightly lower after a strong 1.3% rally from last week’s three-year low. Yet the greenback remained close to its 17-year high against the Chinese Yuan, a level driven by trade tariffs enacted during Trump’s presidency.
Crude oil prices remained relatively flat as well. Brent crude held steady at $76 per barrel after rebounding 28.7% since hitting a four-year low in early May.
Physical demand for silver remains subdued. According to analysts at SFA (Oxford), sales of silver bullion coins from the U.S. Mint are down 39% year-to-date compared to 2024. Premiums on retail silver and gold coins have also dropped to record lows, per long-established dealer Asset Strategies International.
Still, both gold and silver saw slight gains during Wednesday’s midday London auction. Gold fixed above $3380 per ounce, while silver rose by nearly 10 cents—ending a rare five-day divergence between the two metals, the longest such streak in over two decades.
