Silver Price News: Silver Tests Levels Below $27.00 An Ounce

Silver prices ticked lower on Tuesday, although the market showed tentative signs of stabilising after falling to a three-month low on Monday.

Prices nudged lower to $26.66 an ounce on Tuesday before pulling back up to just under $27.00 an ounce later in the session. That compared with around $27.30 an ounce in late trades on Monday.

The precious metals got caught up in the wider financial market meltdown seen on Monday, which added to losses of around $6.4 trillion for share prices around the world over the last three weeks, according to news reports.

This appeared to weigh on gold prices as traders may have been forced to cover margin calls by selling out of positions in precious metals. This may have neutralised any support that would have emerged for safe haven assets amid the stock market turmoil.

The stock market sell-off came amid concerns over growth in the US economy after a raft of bearish figures were released in recent days, including non-farm payrolls, unemployment figures and manufacturing which all came in below market expectations.

The markets now appear to be banking on a 50-basis point cut to US interest rates in September, and there has even been talk of a rate cut outside of the Fed’s normal meeting schedule.

Since around 50% of demand for silver comes from the industrial sectors, any slowdown in growth tends to have a more acute effect on silver than gold, which benefits more from safe-haven flows during times of economic trouble.