Silver prices fell back a few cents on Tuesday in lacklustre conditions, with the market following in line with a modest drop in gold prices.
Prices briefly tested the downside at around $24.76 an ounce before recovering slightly to around $24.94 an ounce later in the session. That compared with $25.05 to $25.10 an ounce in late deals on Monday.
The slight weakness for silver on Tuesday mirrored modest weakness in gold prices, with the markets in wait-and-see mode for further direction.
The US dollar strengthened against other currencies on Tuesday which lent a bearish tone for gold and silver prices.
The minor dip in prices for silver came in the context of a sharp rally seen through the first half of March which saw prices hit a 3.5-month high of just over $25.40 an ounce.
This week will likely be dominated by the US Fed’s interest rate decision on Wednesday, widely expected to show a continuation of the existing 5.5% rate, followed by the Bank of England’s turn on Thursday, where rates of 5.25% are expected to be similarly kept on hold. Of more significance for the market will be any fresh clues about plans for monetary easing, with markets currently betting on the likelihood of a 25-basis-point cut by the US Fed in June.
Any eventual start to an interest rate-cutting cycle would be expected to support precious metals prices as non-yield-bearing assets.
Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.
This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.
Read our Editorial Guidelines here.
