Silver's 47% Crash: The Fed's Hawkish June 2026 Meeting Explained

Silver's relentless 2025–2026 rally came to a jarring halt in June 2026, with the metal plunging roughly 47% from its all-time high to trade near $65 per ounce. The primary trigger was a single event: the Federal Reserve's unexpectedly hawkish June policy meeting — the first chaired by Kevin Warsh — which flipped the rate outlook upside down and sent the dollar surging to a one-year high .

This article breaks down the causes of the selloff, the specific signals from the Fed that spooked markets, how far silver has fallen, current sentiment, and the sharply divided outlook among analysts.

What caused the selloff to ~$65/oz

The decline unfolded in two distinct phases:

Phase 1: Pre-FOMC repricing. In the first week of June, silver slid more than 4% to around $65 an ounce as traders ramped up bets on a Fed rate hike. The metal broke below its 200-day moving average for the first time since April 2025 — a key technical breakdown . A stronger-than-expected May nonfarm payrolls report drove benchmark 10-year Treasury yields above 4.5%, strengthening the dollar and adding pressure .

Phase 2: Post-FOMC confirmation. After the Fed's June 17 decision, silver fell below $65 again — to its lowest level since June 11 — and was on track for a weekly loss of roughly 4.5% as the dollar climbed to a one-year high . On June 19, spot silver closed at $65.795, down 3.14% on the day .

The specific Fed signals that drove the selloff

The Federal Open Market Committee (FOMC) voted unanimously on June 17, 2026 to hold the federal funds rate at 3.50%–3.75% — the fourth consecutive hold . The rate decision itself was widely expected. The shock came from the details in the Summary of Economic Projections (SEP) and accompanying statements:

• The dot plot flipped. The median FOMC member shifted from expecting a rate cut in 2026 to projecting a rate hike by year-end — a complete reversal from the March projections . The median federal funds rate endpoint for 2026 rose to 3.8%, up from 3.4% in March .
• Nearly half of FOMC members now back a hike. Nine of 18 voting members penciled in at least one rate hike this year, with six projecting two or more .
• Inflation forecasts were raised sharply. The Fed revised its 2026 core PCE inflation forecast up to 3.3%, while simultaneously lowering the unemployment rate projection .
• The policy language hardened. The committee dropped its easing bias and moved to a neutral stance, signaling it was no longer leaning toward cuts .
• Chair Kevin Warsh's hawkish debut. In his first press conference, Warsh struck a stern tone on inflation. Sources noted he "returned to his hawkish roots" and that his comments "sent ripples through the financial markets"
• The dollar surged. The US Dollar Index (DXY) climbed to a one-year high, creating a direct headwind for dollar-denominated precious metals like silver .

How far silver has fallen from its January 2026 record high

Silver's all-time high was set on January 29, 2026, at $121.64 per ounce . From that peak to the ~$65 level in mid-June, the metal had fallen approximately $56–57, or roughly 47% . It was one of the most aggressive corrections in modern precious metals history.

Market sentiment and rate-hike probability

Sentiment turned deeply bearish for precious metals. The CME FedWatch tool assigned a 61% probability of a 25-basis-point rate hike by the October 2026 meeting . Other sources estimated the market was pricing in roughly a 70% chance of a hike by September .

Institutional outlooks also shifted. Nuveen stated plainly: "We do not expect a rate cut until 2027" . Nearly half of FOMC members now explicitly support a hike in 2026, and traders began anticipating that the first increase could come within a few months .

Analysts' divided projections for silver's near-term trajectory

Analyst views are sharply split between bearish near-term caution and bullish structural optimism.

Bearish / Cautious

• Some analysts forecast a 10–15% decline during June, citing "de-hoarding" supply as sellers accept the current price plateau .
• The technical picture is unequivocally weak: silver broke its 200-day moving average and has corrected nearly 50% from its peak.
• CoinCodex's forecast model projected silver could fall as low as $44.23 by September 2026 .

Bullish / Structural

• J.P. Morgan expects silver to average around $81/oz in 2026, with quarterly forecasts near $84–$85 .
• The Silver Institute reports six consecutive supply deficits totaling 762 million ounces, with a projected 67 million oz deficit in 2026. Advocates argue this structural case is actually stronger now than it was in January .
• Year-end consensus forecasts cluster in the $78–$92 range, with some analysts — including Bank of America — calling as high as $135 .
• Some advisors argue the correction was a "setup" for the next leg higher. They point to intact supply deficits and the potential for dollar softness if a US-Iran truce eases oil prices and inflation pressure .

The central tension in silver's outlook is this: record supply deficits and robust industrial demand argue for higher prices over time, but near-term, a hawkish Fed, strong dollar, and deteriorating technicals suggest that the selling pressure may not be over.