Silver Rises Over 120% YTD 
A massive arbitrage trade in precious metals that flooded the United States with over $80 billion worth of gold and silver has suddenly ended following Wednesday’s announcement that these metals would be exempt from Donald Trump’s new tariff policy. For several months, traders had been responding to unusual price premiums in New York compared to global benchmarks, as markets priced in the risk of potential tariffs on precious metals.
The price differentials—known in the industry as the “exchange for physical” or EFP—collapsed dramatically on Thursday after the exemption announcement. Gold’s premium dropped from over $62 to just $21 an ounce, while silver’s premium plummeted from more than $1 to merely 8 cents per ounce. This unprecedented influx of precious metals had significant macroeconomic impacts, contributing to a record US trade deficit in January and prompting economists to exclude gold from their calculations. While February saw a slight decrease in imports, they remained historically high, with gold inventories increasing by 26.5 million ounces and silver by 174.6 million ounces since November.
