- The price of silver advances as the demand for safe refuge increases due to fears around global economic uncertainties.
- Citigroup hopes that the Fed will implement rate cuts of 25 basic points in September, October and December.
- Trump administration officials will meet their Chinese counterparts in London on Monday.
The price of silver (XAG/USD) extends its winning streak for third consecutive session and has marked a new maximum of $ 36.42 per Troy ounce on Monday. The price of gray metal rises due to the increase in the demand for safe refuge amid fears around global economic and commercial uncertainties.
Assets without yield, including silver, possibly received support after Citigroup published their forecasts on Monday, hoping that the Fed will make a 25 basic points cut in September, October and December. The firm also expects the Central Bank to cut 25 basic points in January and March 2026.
However, the US labor market data (USA) stronger than expected for May, published on Friday, increase the expectations that the Federal Reserve (FED) maintain its reference interest rate without changes in its upcoming two monetary policy meetings.
Investors adopt caution before the renewed trade negotiations between the US and China in London. The president of the USA, Donald Trump, had a phone call of an hour and a half with the Chinese president, Xi Jinping, Thursday. Trump also said that the call resulted in a very positive conclusion for both countries.
Trump administration officials, Treasury Secretary Scott Besent, Commerce Secretary Howard Lutnick and trade representative Jamieson Greer, are scheduled to meet with their Chinese counterparts in London on Monday. The positive feeling around the possible commercial conversations between the two largest economies in the world supports risk -sensitive assets and limits the potential of shelter metals, including silver.
La Plata receives support from solid industrial demand in solar energy applications. The La Plata Institute reported that the global silver supply was 15% lower than demand in 2024. The association also expects another deficit in 2025.
FAQS SILVER
Silver is a highly negotiated precious metal among investors. Historically, it has been used as a value shelter and an exchange means. Although it is less popular than gold, operators can resort to silver to diversify their investment portfolio, for their intrinsic value or as a possible coverage during periods of high inflation. Investors can buy physical silver, in coins or bullion, or negotiate it through vehicles such as the funds quoted in the stock market, which follow their price in international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can cause the price of silver to shoot due to its safe refuge status, although to a lesser extent than that of gold. As an asset without performance, silver tends to climb with lower interest rates. Its movements also depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (XAG/USD). A strong dollar tends to maintain the price of silver at bay, while a weaker dollar probably drives rising prices. Other factors such as investment demand, mining – silver supply is much more abundant than gold – and recycling rates can also affect prices.
Silver is widely used in the industry, particularly in sectors such as electronics or solar energy, since it has one of the highest electrical conductivities of all metals, surpassing copper and gold. An increase in demand can increase prices, while a decrease tends to reduce them. The dynamics in US economies, China and India can also contribute to price fluctuations: for the US and particularly China, its large industrial sectors use silver in several processes; In India, the demand for consumers for precious metal for jewelry also plays a key role in pricing.
Silver prices tend to follow gold movements. When gold prices go up, silver typically follows the same path, since their status as shelter is similar. The gold/silver ratio, which shows the number of ounces of silver necessary to match the value of an ounce of gold, can help determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that silver is undervalued, or that gold is overvalued. On the contrary, a low ratio could suggest that gold is undervalued in relation to silver.
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.
