Silver price falls following worst day since beginning of year

The price of silver has fallen for a second straight day so far in today’s session following its biggest drop since the beginning of the year. The precious metal closed below the $17 level after a selloff across the commodities sector took its toll.

Silver for immediate delivery had shed 0.46 percent, or seven cents, to $16.73 as of 06:59 GMT, and was trading 3.39 percent above its 50-day simple moving average of $16.18. Yesterday, the precious metal suffered its steepest fall since the beginning of the year after closing 1.2 percent down at $16.82. It settled below $17 after managing to close above it on Tuesday for the first time since 11 December.

A decline in sentiment across markets during the previous session after the World Bank cut its economic growth forecasts on Tuesday led to a selloff in precious metals along with copper, which slid to a 5-1/2 year low. Disappointing US retail sales data and a weaker dollar that would have typically boosted safe-haven bids failed to offset the bearish mood towards commodities. According to yesterday’s report from the US Department of Commerce, retail sales declined 0.9 percent in December from the previous month, along with a one percent drop in core retail sales. The release saw the US dollar retreat from nine-year highs versus the euro.

The price of silver for March delivery had shed eight cents, or 0.4 percent, to $16.76 as of 06:32 GMT. Gary Wagner, editor of The Gold Forecast, wrote in a note from yesterday: “Silver prices were hit by a round of profit-taking only a day after gold experienced the same impulse.”
Meanwhile, the US Mint released data for sales of Silver Eagle coins for the first two reporting days of 2015. The Washington-based agency reported sales of 2,958,000 coins on Monday, along with an additional 656,000 on Tuesday for a total of 3.6 million coins during the first two days, compared with 4.7 million for the entire month of January last year.
Based on the two most actively traded COMEX contracts, with a total volume of trade in gold and silver of 21,703 contracts as of 06:32 GMT today, the gold:silver ratio was at 73.21. The ratio was up 0.28 percent from yesterday’s 73.00 close.