Silver Steadies Near $57 as Speculators Trim Bets and Vault Stocks Build

Silver closed out a bruising week on a firmer note, settling at $57.13 an ounce on Friday. The rebound was powered less by conviction than by two familiar crutches: a softening US dollar, which makes the metal cheaper for buyers outside the dollar bloc, and a flight into hard assets as equity markets around the world churned.

The recovery came after a sharp midweek slide. US consumer price data for September showed inflation running hotter than expected — up 0.6% month on month and 3.7% year on year — and silver took the hit, tumbling 6.29% to $55.74 an ounce on the day of the release, its lowest close of 2026. A producer price index for final demand that climbed 1.3% in September added to the jitters, reopening the debate over where US interest rates go next.

Futures Positioning Shows the Retreat

The inflation surprise left a clear mark on derivatives markets. According to the Commodity Futures Trading Commission, funds and asset managers held 15,802 long contracts against 10,183 shorts in the week through October 13, leaving a net long of just 5,619 contracts — a drop of 1,909 contracts in a single week. The scaling back of bullish exposure came as core inflation also overshot forecasts, hardening expectations at the interest-rate markets that the Federal Reserve will keep policy restrictive. Non-yielding metals tend to suffer when returns on fixed-income assets rise.

An earlier CFTC snapshot, dated October 6, had shown COMEX silver open interest at 105,130 contracts — a reading that captures positioning just before the selloff and points to heavy dealer engagement on the exchange.

London Vaults Add Metal

Physical stockpiles tell a different story from the speculative unwind. The London Bullion Market Association's latest quarterly report put silver holdings in London vaults at 28,985 tonnes at the end of September, up 3.22% from the prior quarter. Those figures cover the reserves of participating warehouses and do not reflect global demand.

COMEX warehouses also saw inflows. The exchange reported a total of 333.2 million ounces as of October 14, an increase of 1.2 million ounces from the previous reporting period, of which 103.1 million ounces was metal ready for delivery.

Miners Deliver a Mixed Quarter

Third-quarter production updates from silver miners painted an uneven picture. Guanajuato Silver reported output of 392,138 ounces, while Aya Gold & Silver notched a record 1.50 million ounces at its Zgounder mine. First Majestic produced 3.4 million ounces across four Mexican operations but flagged work stoppages, and Endeavour Silver — despite a mill repair in September that slowed operations — still brought in 2,096,545 ounces.

Fed Meeting Takes Centre Stage

With the metal down 19% year to date and trading roughly 18% below its 200-day moving average, attention now swings to the Federal Reserve's rate-setting meeting on October 27 and 28, 2026. The decision and the accompanying commentary from policymakers should determine whether the recent floor holds or whether the remaining long positions are unwound further. Before that, the US dollar's trajectory and risk appetite on equity markets are likely to set the tempo for silver. The next major data test comes on November 10, when the US Bureau of Labor Statistics publishes October consumer prices — the first real gauge of whether the recent price pressure has become entrenched.