29/12/2025 Daily Reports
The precious metals market is ending 2025 with a bang—and a lot of whiplash. Silver just hit a record-breaking $84 an ounce overnight before tumbling back down. Here is everything you need to know about the current “Silver Squeeze”:
The Massive Surge
- Historic Gains: Silver briefly touched $84/oz, marking its strongest performance since 1951. It is currently up a staggering 153% for the year 2025.
- The “Musk Factor”: After China (a major refiner) hinted at export restrictions, Elon Musk took to X to warn that silver is critical for industrial processes, fueling a speculative frenzy.
- Supply Crunch: Global stockpiles are draining. Inventories in Shanghai are at their lowest since 2015, and the cost to borrow physical silver recently hit record highs.
The Sudden Slump
- Margin Hikes: The CME Group just raised margin requirements by 25%. This forces leveraged traders to either cough up more cash or sell their positions, putting immediate downward pressure on prices.
- The Gold Drag: Gold also retreated to $4,462/oz, dragging the rest of the precious metals complex (platinum, palladium, copper) lower.
Why Volatility is Here to Stay
- The “Big Rebalance”: Starting January 8, massive commodity indexes (controlling $240 billion) will rebalance. Investors will likely sell “winners” like silver and gold to stick to their target weights.
- Year-End Marking: As the year closes on Dec 31, fund managers are cleaning up their books, which often leads to erratic price swings.
- Critical Mineral Status: Silver is now officially a “critical mineral” in the U.S. due to its roles in AI data centers, EVs, and solar energy, making it more than just a “precious” metal—it’s an industrial powerhouse.
What’s Next?
The current volatility in silver feels like a “perfect storm” where industrial necessity meets speculative mania. While the 25% margin hike by the CME is a classic “cooling” mechanism to prevent a total bubble burst, the underlying fundamentals—specifically silver’s role in AI infrastructure and Green Tech—suggest that this isn’t just a meme-stock rally. However, with the upcoming index rebalancing in January, we might see a “healthy correction” before the next leg up.
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- Holiday-thinned trading is keeping risk tone fragile and headline-driven, with markets leaning on expectations for 2026 Fed rate cuts and turning to Tuesday’s FOMC minutes as the key near-term catalyst. U.S. equity futures were mostly flat into another holiday-shortened stretch, while year-end positioning (“Santa rally” watch) remains in focus with the S&P 500 near 7,000 and the Nasdaq Composite up about 22% YTD. In the latest thin-tape single-name moves, Nvidia drew attention on Groq-linked licensing/hiring headlines, while Target was highlighted after reports of an activist stake.
- In Europe, equities continue to hover near record levels, supported by easing-rate expectations and positioning; Novo Nordisk’s jump after U.S. approval of its weight-loss pill recently lifted healthcare and briefly pushed the region to a record high. Europe is also watching the same U.S. macro cue—Fed minutes—while China’s provisional duties on EU dairy imports add a lingering trade-friction overhang.
- In Japan, BOJ policy and the yen are back in focus after the rate hike to 0.75% and signals that further hikes remain possible, alongside renewed warnings against “excessive” FX moves. Asia’s risk headlines also include reports of large-scale Chinese drills around Taiwan. Japan’s Nikkei is up roughly 27% for the year.
- Energy is being pulled by weather and geopolitics: a major U.S. winter storm raises near-term natural gas demand risk, while recent pricing has been shaped by shifting weather forecasts versus near-record output. Oil moved higher as markets weighed Ukraine/Middle East risk headlines, including a Trump–Zelenskiy meeting and fresh supply-disruption concerns.
