Silver is back above $24 an ounce but still lacking a clear direction as investors contrast the metal’s strong fundamental case against the prospect of further interest rate hikes from central banks on both sides of the Atlantic.
Last week’s pause by the Federal Reserve hasn’t been greeted by a switch to full risk on mode by traders with plenty of caution still abounding amid fears that many economies remain close to recession.
For silver, the Fed’s series of interest rate hikes proved to be the single biggest drag on the metal’s price in the last year, so the prospect of more hikes still to come has dented silver’s attempts to climb higher.
Yet the metal remains in a supply deficit and looks set to be in strong demand from the solar sector for many years to come. Therefore when these interest rate clouds do finally lift, silver’s long term prospects still look very bullish and suggest a price far higher than its current $24 an ounce level.
Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience in writing about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News.
As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewable energy and the challenges of avoiding greenwash while investing sustainably.
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