Silver prices eased slightly lower on Thursday as most of the wider financial markets were in a bullish mood. Silver prices drifted lower to around $22.75 an ounce by late deals on Thursday, compared with around $22.90 an ounce late Wednesday.
Silver followed gold’s lead lower on Thursday, as most of the wider financial markets were in risk-on mode, with investor flows moving from safe havens to higher-risk assets like stocks.
US unemployment figures were released Thursday showing a surprise drop in the week to February 17, pointing to a stronger-than-expected economy. US stock markets also moved higher and the US dollar also rebounded off an earlier low on Thursday, making dollar-denominated precious metals more expensive for buyers in other currencies.
Looking at the longer-term charts, silver’s price downtrend seen over the last three months has shown signs of abating, as highlighted by a rebound from lows of around $22.00 an ounce in November, January and again in February. This potentially sets silver prices up for longer-term gains, but this is likely to be contingent on the start of interest rate cuts by major central banks – something that is by no means certain to materialise in the first half of 2024.
Looking ahead, Monday will see a speech by ECB President Christine Lagarde, which may offer some pointers on the outlook for monetary policy in Europe. Then on Tuesday, figures are due for release showing US durable goods orders for January, with markets expecting a 4.5% drop versus December levels. These include consumer electronics, jewellery and medical equipment, all of which are relevant to industrial demand for silver, which makes up roughly half of the total demand for the white metal.
Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.
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