Key Moments
- Silver prices suffered a nearly 30% decline, described as a “move for the history books.”
- The sharp drop in silver coincided with meaningful declines in Gold and Copper, as outlined by MUFG’s Michael Wan.
- A strengthening Dollar contrasted with potential support for Asian currencies, while markets assessed Kevin Warsh’s stance on rate cuts and Fed balance sheet reduction.
MUFG Analysis of Commodities Under Pressure
Silver prices underwent a historic fall of close to 30% as markets responded to the leadership of Kevin Warsh at the Federal Reserve, according to analysis by Michael Wan, Senior Currency Analyst at MUFG. The move in silver occurred alongside notable weakness in other key commodities, including Gold and Copper.
Silver just had its worst day since 1980 – down 30%.
Was that panic or profit‑taking?
Physical shortages remain while “paper” prices collapse.
A classic transfer‑of‑wealth moment.#SilverPriceCrash #Investing https://t.co/ednwVx8kCI pic.twitter.com/QY3qDHoFuv
— Stewardship Finance Academy (SFA) (@SFA_Xcom) February 2, 2026
Wan highlighted that the sell-off in silver formed part of a wider adjustment across commodity markets. The behavior of precious and base metals was assessed within the broader macro environment, including monetary policy expectations and currency market dynamics.
| Asset | Observed Move | Context |
|---|---|---|
| Silver | Fell sharply by close to 30% | Described as “a move for the history books” |
| Gold | Fell meaningfully | Part of broader commodity weakness |
| Copper | Fell meaningfully | Declined alongside other commodities |
Warsh’s Evolving Policy Stance and Market Reaction
The report linked the market response to expectations surrounding Kevin Warsh’s role at the Federal Reserve. It noted that investors were focused on how his policy views could affect interest rates, the Fed’s balance sheet, and ultimately major asset classes such as commodities and currencies.
MUFG cited Warsh’s recent position on monetary policy and structural developments in the U.S. economy:
“In particular, silver prices fell sharply by close to 30% in a move for the history books, while gold, copper and several other commodities also fell meaningfully.”
“More recently however, Kevin Warsh has been more supportive of interest rate cuts, due to his views that there has been a productivity boom in the US through AI, and with that rates can be lowered without causing undue inflation.”
“Whether he can coalesce his Fed colleagues both into doing so and also other key beliefs such as reducing the size of the Fed’s balance sheet remains to be seen.”
Currency Market Implications
Alongside the analysis of commodities, Wan’s report pointed to divergent trends in foreign exchange markets. The Dollar was described as strengthening, while at the same time the outlook implied that Asian currencies may find some support going forward.
The interaction between a firmer Dollar, potential interest rate cuts, and adjustments to the Federal Reserve’s balance sheet was presented as a key backdrop for both commodity and currency market participants monitoring these developments.
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