Gold and silver extend selloff after market meltdown

February 2, 2026 - 03:52

Gold and silver prices extended their declines this week, deepening a selloff that began after a broad downturn in financial markets. The retreat marks a significant shift for both metals, which had been on a blistering yearlong rally prior to the recent downturn.

That earlier surge was fueled by sustained, heavy buying from central banks around the world alongside persistent geopolitical tensions, which traditionally boost the appeal of safe-haven assets. Investors had flocked to bullion as a store of value amid global uncertainty.

However, the dynamic shifted sharply as weaker-than-expected economic data and shifting interest rate expectations triggered a wave of selling across equities and other risk assets. This market meltdown created a need for liquidity, prompting investors to sell profitable positions in gold and silver to cover losses elsewhere, a process known as margin-call selling.

The resulting pressure has pushed prices to multi-week lows, with silver, often more volatile than gold, experiencing particularly steep losses. Analysts note that while the long-term supportive factors for precious metals remain, the short-term trajectory is now closely tied to broader market sentiment and upcoming central bank policy decisions. The focus turns to whether physical demand can provide a floor for prices amid the current financial volatility.