Silver is trading just below $25 an ounce as investors assess the latest round of earnings and try to determine the true health of the global economy.
In this environment, silver is working out which of its different hats is most applicable. Its safe haven appeal and lack of counterparty risk can bolster demand at times when market confidence is low, as was certainly the case during last month’s US banking crisis. Yet the metal also has considerable industrial exposure so a healthy global economy is important for physical demand.
Finally, investors need to weigh up how much further the Federal Reserve and other central banks are likely to keep hiking interest rates with the metal’s lack of yield reducing its appeal during times of rising rates.
As such, the current situation in which earnings reported so far point to a relatively healthy global economy mixed in with an investor mindset which is fearful of putting too much risk on the table plays nicely into silver’s dual appeal and should see the price hold close to $25 an ounce, with the potential to push higher again.
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 greenwash while investing sustainably.
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.
