Silver Consolidates Waiting For Metal’s Fundamental Case to Shine

Silver continues to trade above $19 an ounce, even with today’s slight pullback on prices as investors adjust to the European Central Bank’s interest rate hike yesterday.

The medium-term prospects for silver are far more bullish than gold as while gold can only realistically hope for a period of consolidation rather than significant gains, silver’s fundamental outlook gives the metal potential to climb much higher.

Silver has been weighed down for over six months by the Federal Reserve’s hawkish pivot, with the metal heavily punished by each interest rate hike by the US central bank and every comment by a Fed official. With that pressure easing a fraction as investors start to predict that December could be the last of the Fed’s large rate hikes, attention can turn to silver’s fundamental case.

The metal will be in high demand for the foreseeable future with silver a key component of the energy transition through its use in photovoltaic cells for solar energy and batteries for electric vehicles. Therefore, as soon as the interest rate cloud lifts, expect silver to make large gains in a short period of time.

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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