Silver is just about holding above $23 an ounce as investors weigh up silver’s safe haven appeal as Israel continues to attack Gaza against a macroeconomic environment in which interest rates are set to stay at elevated levels for a sustained period.
While silver doesn’t have the same safe haven appeal as its precious metal peer, gold, it has still benefited from the broader risk-off environment that prevailed in the wake of Hamas’ attack on Israel and the Middle Eastern country’s aggressive response.
Yet the metal also has much more industrial exposure than gold so the state of the global economy also has a significant bearing on the price of silver. As a result in a week of central bank interest rate decisions, Wednesday’s quarterly refunding announcement by the US Treasury arguably is the most significant for silver investors with the central banks all expected to keep their rates unchanged.
The long-term outlook has remained attractive for silver throughout the year as the metal is a key component of the energy transition away from fossil fuels and towards renewable and electric options. However, this fundamental side has struggled to get a look in amid first macroeconomic considerations and now geopolitical ones. As such, silver is likely to track around its current $23 an ounce mark in the short-term.
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