Silver prices pushed up to a three-month high at the end of last week, with prices topping the $24.30 an ounce mark on Friday for the first time since early September.
Prices spent most of Friday morning trading in a range of $23.60 to $23.75 an ounce in fairly subdued conditions. However, Friday afternoon saw a surge higher to over $24.30, rounding off the week in bullish fashion.
The US dollar weakened against other major currencies on Friday, adding to a drop in the dollar’s value seen throughout November, and providing a supportive element for dollar-denominated assets like gold and silver.
However, the scale of silver’s move higher may have been exacerbated by thin liquidity due to the US Thanksgiving holiday on Thursday and a half day of trading on Friday.
A further contributing factor may have been recent speculation that the US Fed is done with interest rate hikes, which if borne out, would potentially remove a barrier holding silver prices back.
Silver’s dual role as an investment asset and a semi-industrial metal makes its response to economic data complex. Data suggesting a weaker economic outlook may indicate lower industrial demand for silver, but paradoxically may lead to central banks taking a more dovish stance on interest rates – a positive driver for non-yield-bearing assets like silver and other precious metals.
Carlo is an external market analyst for Kinesis Money. With a credential background in Economic Finance and International Exchange (MA), Carlo’s critical analysis of gold and silver markets’ performance is frequently quoted by leading publications such as Forbes, Reuters, CNBC, and Nasdaq.
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.
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