Gold and Silver Crash Sparks Chaos in Global and Nigerian Markets
Gold and silver prices have plunged sharply in the latest trading session. The drop follows a record-breaking surge earlier this year, with gold hitting all-time highs above $5,000 an ounce in late January. The sudden selloff has sent shockwaves through global markets, including Nigeria, where gold plays a key role in financial security for many traders.
The steep decline began after gold reached a peak of $5,111 an ounce in January 2026. This high came after a year of strong gains, driven by geopolitical tensions, central bank demand, and a weaker US dollar. But the trend reversed when the dollar rebounded on speculation that Kevin Warsh could become the next Federal Reserve chair.
A 'gamma squeeze'—a rapid unwinding of options positions—then pushed gold down by over 12% in a single session. Silver suffered even more, crashing 36% below $85 an ounce, its largest intraday drop ever. Copper also fell by 3.4% after hitting a recent high on Thursday.
The impact is being felt in Nigeria, where market women rely on gold as both an investment and a liquid asset. Known as the 'informal backbone' of Africa's largest economy, these traders buy gold regularly, often using a dollar-cost averaging approach. They wear it as jewellery but sell quickly when cash is needed, treating it as a hedge against economic instability.
Now, with prices tumbling, the two largest precious metals sellers are fully liquidating their inventories. This adds further pressure to an already volatile stock market today.
The sharp fall in gold and silver has disrupted a long-standing strategy for wealth preservation in Nigeria. Market women, who depend on gold for emergency liquidity, now face reduced asset values. Meanwhile, the broader selloff reflects broader financial shifts, from Fed policy expectations to aggressive trading moves in commodities markets.
