Gold-silver ratio falls to its lowest since Trump’s ‘liberation day’ tariff announcement

Gold-silver ratio has dropped to roughly 94 from historic highs above 100.

Silver rallied Thursday to tap its highest price in more than 13 years, with the industrial metal finally making a significant move to catch up to gold’s gains, pulling the gold-silver ratio down to its lowest level since the Trump administration’s “liberation day” tariff announcement.

Silver for July delivery settled at $35.81 an ounce Thursday on Comex, the highest most-active contract finish since Feb. 28, 2012, according to Dow Jones Market Data. It has gained about 22% so far this year.

“The breakout has been brewing for a while, as silver had attempted to break through the $35 level a couple of times in recent months, so this is highly significant,” said Maria Smirnova, senior portfolio manager and chief investment officer at Sprott Asset Management, in remarks sent by email to MarketWatch on Thursday.

“If the technical move catalyzes physical investor-buying, it can take silver much higher very quickly,” she said. “The silver market is thin, and it will not take much buying activity to send the price higher.”

The rally for silver comes as prices for gold posted a loss for the session. August gold lost $24.10, or 0.7%, to settle at $3,375.10 an ounce. The yellow metal’s year-to-date rise of nearly 28% still outpaces that of silver.

The gold-silver ratio, however, has fallen toward 94. The ratio is a measure of gold’s value in terms of its “industrially useful cousin” silver, according to Adrian Ash, director of research at BullionVault. That means it takes about 94 ounces of silver to buy one ounce of gold.

The ratio is down by 10 ounces of silver from the post-COVID high of more than 100 seen as gold touched its current all-time dollar high of $3,500 in late April, said Ash.

The current ratio is also the lowest reading since April 2, the day President Donald Trump announced his “liberation day” tariffs, which spurred a “brief but severe slump in industrial commodities and global stock markets,” Ash said. Silver prices plunged more than 15% from April 2 to April 4, following Trump’s tariff announcement. Gold, meanwhile, fell by roughly 4% during that same period.

Because gold is such a narrative asset, traders and analysts have raced to find a headline trigger for silver’s jump Thursday, said Ash. “But nothing stands out as spurring today’s price surge in London — not in the news, not in lease rates, and not in [exchange traded funds] or Comex data.”

In commentary Thursday, Rhona O’Connell, head of market analysis at StoneX, also said there didn’t appear to be a specific trigger for silver’s latest move higher.

The slide below the 100 level in the gold-silver ratio, however, may well have triggered ‘ratio trading.’

— Rhona O’Connell, StoneX

The slide below the 100 level in the gold-silver ratio, however, may well have triggered “ratio trading,” she said.

“The fact that silver is at the highest since 2012 is, of course, of interest, but silver is notoriously volatile and it is fully capable of dropping as sharply as it rises,” said O’Connell. “This is not necessarily a false move, but it is now heavily overbought and should, as always when silver does this sort of thing, be treated with caution.”

Still, there had been signs that silver was poised to make such a breakout move higher.

Gold’s record run had left silver behind and silver lagged in its efforts to play catch-up, even as the gold-silver ratio held firm near historic highs.

A deficit in global silver supplies was part of the reason some analysts saw potential for a significant upside move in prices for the metal.

“We have been talking for a while about the supply/demand deficits in silver,” said Sprott’s Smirnova. Global silver demand was expected to top silver supply for a fifth year in a row in 2025, according to the Silver Institute.

And the deficits are projected to continue, said Smirnova. “Silver has a very positive investment case right now.”

That doesn’t necessarily mean a move to fresh record highs for silver, however.

“Given the headwinds that silver’s industrial demand faces, it’s hard to see the metal extending this jump anywhere close to the 2011 and 1980 high of $50” an ounce, BullionVault’s Ash told MarketWatch.

Still, “with no one in the market able to pinpoint as yet what’s driven the move to 13-year highs…silver has confirmed its reputation as the ‘Devil’s metal,’ leaping without warning and leaving the technical picture very bullish for further gains,” he said.