CORNERING SILVER MARKET
From electronics to photography, jewelry and coins, silver is integral to numerous everyday products.
Its high electrical conductivity and durability gives it industrial and technological applications, with almost every computer, mobile phone, automobile and appliance containing silver, but it's often overlooked in favor of its lustrous cousin gold, but the price of silver has jumped over 70% in the last year, with commodity strategists saying the rally is likely to continue as the global economy reopens.
Demand for the precious metal has shot up in the past 12 months. Around 50% of the demand for silver is industrial, the rest come from investors. Still, its uses in industry is one of the main reasons driving its recent rise in value. Industrial demand is probably the main reason why we've seen silver outperform gold, as it has over the last year. The rise in silver demand definitely coming from industrial metals which have really been on a tear.
Additional factors have also played into silver's rise, such as the shift towards green technologies which have spurred a rise in demand for industrial metals such as silver which are used in solar panel production, for instance.
If gold rallies then silver tends to rally, but even stronger, so most silver investors are probably keeping a close eye on gold prices, the level of the dollar and the level of interest rates.While inflation might be seen as good for these precious metals, market watchers will also be keeping an eye on any tightening of monetary policy which aims to keep price rises under control.
Large silver producion and it's lowered prices:
The decline in the value of silver has been largely influenced by increases in the cost of silver production, This increase in it's production cost has been driven by the fact that silver is often produced as a by-product of other mining operations, rather than purposefully explored for and extracted. The world’s largest silver mine by production.
What influences silver prices?
Silver works both ways: it acts as a base metal as well as a precious metal. In recent past, it has acted more like precious metal during the uncertainty related to the global trade war, Brexit and even the coronavirus outbreak. Of late, silver has been steadily moving higher in line with other base metals like copper, and traded in a broad range. Sudden panic in the market and a strong hit on businesses, especially in China, forced silver to act as a safe haven precious metal and follow gold’s trail.
Comments
Post a Comment