Posted 11th November 2022

Silver at Highest Since June on Optimism That US Inflation Has Peaked

market analysis silver

Silver keeps on climbing and is now at its highest level since June with yesterday’s lower-than-expected inflation figure out of the US the latest source of optimism.

Inflation that is showing signs of finally being on a downward trend will provide the Federal Reserve with more wiggle room to reduce the aggressiveness of its upcoming interest rate moves. This is beneficial for silver as it was the Fed’s adoption of hawkish strategy in March that caused a multi-month plunge in the metal’s price. 

After reaching its nadir in September, silver has enjoyed a more stronger performance since then with support continually building as investors wake up to the metal’s strong fundamental case which should see silver in strong demand over the coming years given its use in the key technologies of our time such as 5G, solar panels and in batteries for electric vehicles. 

While silver is set for another week of gains, its performance has been overshadowed by gold’s huge rise in recent days. Given the close correlation between the two assets, that suggests there is more upside potential for silver playing catch up. Certainly, of the two metals, it is silver that has the stronger long-term outlook.

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