Silver prices rallied to a fresh two-month high on Tuesday, holding onto gold’s coattails as the yellow metal hit an all-time high.
Silver prices briefly climbed as high as $24.24 an ounce, the highest price since late December 2023, before pulling back to around $23.70 an ounce later in the session.
The precious metals complex has taken support from recent data showing that the US economy is not as strong as the markets had expected, lending support to expectations that the US Fed could begin its long-anticipated interest rate cutting cycle as soon as June.
The timing of any interest rate cuts is uncertain and the silver price has been moving in both directions in recent weeks on the back of day-to-day data releases that feed into expectations of any US monetary policy changes.
However, silver’s latest push higher was partly linked to gold’s fresh all-time highs, which came on the back of recent central bank buying, strong investor interest and safe-haven flows linked to the current volatile geopolitical climate.
Looking ahead, Wednesday will see testimony by US Fed Chair Jerome Powell, providing a potential update on the central bank’s thinking on interest rates, while the monthly US JOLTs job openings figures for January will also play into the wider picture on the US economy.
Further out, the ECB is also set to make an interest rate decision on Thursday, although this is unlikely to hold any surprises, with the markets fully expecting no change from the current 4.5% rate as the EU’s central bank continues to maintain interest rates to keep inflation under control.
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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