Gold and silver exchange-traded funds suffered a sharp correction in early May 2026, with some funds recording double-digit percentage losses [1, 2].

This downturn signals a shift in investor sentiment away from non-yielding assets. As the cost of holding gold and silver increases relative to interest-bearing securities, these traditional safe havens become less attractive to global investors.

Market data shows gold prices falling between $4,200 [1] and $4,330 per ounce [2]. One report said gold has declined 23% from its peak to the $4,330 level [2].

Silver has experienced even more volatility. Some data said the price of silver has nearly halved from its January peak [1]. Other reports said the iShares Silver ETF has dropped 35% from its peak last year [3]. The Sprott Silver Miners & Physical Silver ETF (SLVR) saw a 12% drop in a single day [4].

Analysts said the crash is due to several macroeconomic factors. Rising U.S. Treasury yields and strong U.S. jobs data have increased expectations that the Federal Reserve will continue raising interest rates [1, 2]. Because gold and silver do not pay dividends or interest, they struggle to compete when bond yields rise.

These movements were reflected across global markets, including the Indian MCX silver futures market [1, 2]. The trend reflects a broader movement of capital toward assets that provide guaranteed returns in a high-interest-rate environment.

“Gold and silver ETFs suffered a sharp correction”

The simultaneous crash of gold and silver ETFs suggests that macroeconomic pressures from the U.S. Federal Reserve are outweighing the traditional role of precious metals as inflation hedges. When Treasury yields rise, the 'opportunity cost' of holding gold increases, leading institutional investors to liquidate commodity positions in favor of fixed-income assets.