Silver has been under even more pressure than gold recently, notes Carsten Fritsch, commodity strategist at Commerzbank.
Silver price has lost around 8% since Wednesday
“Silver prices have lost around 8% since Wednesday of last week and are trading at less than $29 per troy ounce, their lowest level since late June. As a result, the Gold/Silver ratio rose to 83, a level last seen in mid-May. Silver typically follows Gold’s price movements disproportionately. However, this has only recently applied to the downside.”
“The previous bullish move in Gold following the US inflation figures was more or less ignored by Silver. As a result, the Gold/Silver ratio was already rising before the recent price drop. The relative weakness in Silver is likely due to weakness in base metals.”
“This is because industrial applications are expected to account for nearly 60% of silver demand this year, according to the Silver Institute. Most of the increase in silver industrial demand is expected to come from solar power, so the negative reaction in the silver price appears overblown.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
