The price of silver continued to rebound strongly from support this week and could move higher.
XAGUSD – Daily Chart
XAGUSD recently took a sharp 3-day drop to trade near the $28.000 level. That brought a strong rebound with prices back to $32.60 and looking at the previous highs around $35.00.
Continued weakness in the U.S. dollar and turmoil around markets are driving flows to safe havens. A stronger economy in China can push more silver investment and support manufacturing needs. Gold and silver remain popular as economies struggle for growth and markets reel over tariffs.
“While base metals price forecasts have been marked lower due to these tariff concerns, there is an expectation of a favourable risk/reward scenario for investing in base metals in the coming quarters,” JP Morgan analysts said.
Silver tracks the price of gold, but industrial uses such as electronics and solar account for more than half of global demand, estimated at 700 million troy ounces in 2024, according to the Silver Institute industry association.
“I would expect silver to lag gold until there is more economic clarity and a resolution in trade and tariff risks, given silver’s exposure to industrial activity and PMIs,” said Aakash Doshi, head of global gold at State Street Global Advisors.
Recent market turmoil and record highs in gold also bring attention to retail investors, which could increase silver interest as it is a more cost-effective entry to precious metals.
Exchange-traded fund buying and central bank buying of precious metals also drive up precious metals.
