Silver Investors Take Stock With Metal Stabilising Near $22 Yet Asset Remains Cheap

Silver looks to have found its level for the time being at around $22 an ounce. 

Holders of silver have had a volatile few months with bullish runs up to well above $26 an ounce followed by a multi-week plunge that saw the price sink below $21 an ounce. Yet after all that volatility, the price is now almost back to where it started the year and seemingly in a period of calm. 

Live Silver Price – $/oz

Silver typically is more volatile than gold due to the lower volumes that trade the precious metal yet even given this context, the price shocks silver has endured this year have seemed out of sync with the geopolitical and macroeconomic data driving the moves.

This new-found value of around $22 an ounce reflects that the main drivers of the year, first the war in Ukraine and then the series of central bank interest rate hikes to tackle runaway inflation are now effectively priced in. 

While this relative calmness may be welcomed by some, the fundamental outlook points to further gains still for silver. The energy transition will require vast amounts of silver as we shift from fossil fuels to renewable energy, notably solar. Equally the switch to electric vehicles provides another boost for silver demand with the metal used in multiple elements of the drivetrain. 

As such, $22 an ounce still seems too cheap for this in-demand asset.

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 greenwashing while investing sustainably.

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