Silver price edges up as Indian annual imports reach all-time high
iNVEZZ.com, Monday, December 22: The price of silver has edged slightly up so far in today’s trading session. Gains remained limited as dollar strength reduced demand for the precious metal amid news that India had imported a record amount of silver last month.
Silver for immediate delivery had risen 0.13 percent, or two cents, to $16.06 as of 06:33 GMT, and was trading over two percent below its 50-day simple moving average of $16.43. Reuters quoted Howie Lee, an analyst at Phillip Futures, as saying that “we are in the thick of the festive season,” which may see precious metal prices “drift within a range in the coming week”.
Silver rallied 1.3 percent during the previous session but ended the week 5.5 percent down, having suffered steep declines on Monday and Tuesday on speculation ahead of the Federal Open Market Committee meeting. The Bullion Desk cited James Steel from HSBC Securities as saying:
“A strong USD and the likelihood of higher US rates even if inflation remains subdued,” is a recipe for low precious metal prices. According to him, the “run up to the holiday period is traditionally volatile for prices as volumes drop off and even relatively modest investor purchases or sales can have a magnified impact on the market”.
The price of silver for March delivery had risen two cents, or 0.15 percent, to $16.09 as of 06:37 GMT. Koos Jansen, analyst at BullionStar.com, wrote in an article that Indian imports for the precious metals skyrocketed last month as prices declined. According to Koos, India had already imported an annual record 6,789 metric tons of silver over the first 11 months of the year. Should India import 700 metric tons of silver in December, the total would reach 7,400+ metric tons for the year. This would be an increase of 27 percent on the previous record of 5,819 metric tons set last year.
Based on the two most actively traded COMEX contracts, with a total volume of trade in gold and silver at 13,026 contracts as of 06:37 GMT today, the gold:silver ratio was at 74.54, up 0.25 percent from last week’s 74.35 close. Last Monday the ratio ended at 74.61.