Posted 2nd February 2024

Silver Price News: Silver Reverses Losses on Safe-Haven Flows

silver reverses losses on safe flows

Choppy conditions prevailed in the silver market on Thursday, with prices falling close to $22.50 an ounce before rebounding to $23.20 an ounce by late afternoon.

The volatile conditions mirrored those in the gold market on Thursday, where prices were higher overall, but moving in a wide range.

silver price kag on kinesis exchange
Kinesis silver (KAG) price – $/oz – on the Kinesis Exchange

Thursday initially looked like being a decidedly bearish day for silver, with prices sliding as low as $22.53 an ounce compared with a high of $23.44 an ounce on Wednesday.

However, prices rebounded later to reverse the losses, leaving prices higher day-on-day. US figures released on Thursday showed a larger than expected increase in weekly jobless claims, indicating a weaker economy and hiking the probability of an interest rate cut by the US Fed.

In addition, both gold and silver prices moved higher later on Thursday on news that the US plans to launch strikes over several days against Iranian targets in Syria and Iraq, in response to a recent drone attack on a US base in northeast Jordan.

Any further military strikes crank up the risk that the ongoing conflict in Gaza between the Israeli state and Hamas could turn into a wider confrontation. US President Joe Biden was quoted as saying he is not seeking a broader confrontation with Iran. Nevertheless, military action includes the risk of retaliatory actions that could trigger a wider conflict, and this is the key reason why precious metals react in a bullish way to geopolitical tensions as investors move money from high-risk assets to safe havens.

Looking ahead, Friday will see the release of US Non-Farm Payrolls figures and the unemployment rate for January, as well as US factory orders for December. Factory orders include electrical equipment, components, computers and electronic products, all of which drive industrial demand for silver.

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.

This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.
Read our Editorial Guidelines here.