Silver prices held steady near record levels after rising about 17% for seven consecutive sessions, thanks to a wave of betting by traders on the possibility of the US Federal Reserve (Fed) soon cutting interest rates, while the market still faced a shortage of supply. Gold prices have been moving sideways around the same time.
Investors are betting that the upcoming US Fed Chairman, along with the delayed release of economic data this month, will add momentum to President Donald Trump's call for monetary policy easing. The precious metals giants' recent strong rally reflects expectations that the rate cutting cycle could be accelerated after Jerome Powell's term ends in May.
In the short term, the market is pricing in the possibility of the Fed cutting interest rates at this month's meeting. Lower interest rates often give gold and silver an advantage, as these two metals do not create the same yield as other profitable assets.
Silver prices continue to be supported by a strong wave of speculation, as cash flow into the market is betting on a shortage of supply. Silver flows into London last month hit a record high, putting pressure on other trading floors around the world. Meanwhile, inventories at warehouses linked to the Shanghaioversy for goods have fallen to a 10-year low.
As of 8:11 a.m. (Singapore time), silver prices were steady at 58.47 USD/ounce, after reaching a historical peak of 58.84 USD in the trading session on Monday. Gold prices are almost flat at $4,208.54/ounce after two consecutive sessions of decline, while platinum and palladium both decreased slightly.
