Silver price trims gains following biggest monthly advance since June
The price of silver has declined in today’s trading so far, after on Friday posting its biggest monthly gain in six months. While global economic uncertainty since the start of the year has stirred safe haven demand for the precious metal, the prospect of higher US interest rates has now trimmed some of those gains.
Silver for immediate delivery had shed nearly seven cents, or 0.38 percent, to be $17.11 as of 06:51 GMT, some 2.8 percent above its 50-day simple moving average of $16.64. On Friday, the precious metal rallied 1.5 percent in response to a report showing weaker-than-expected US economic growth, closing out January 9.3 percent higher for its biggest monthly percentage gain since June of last year.
Precious metals advanced after the US Department of Commerce reported that fourth-quarter US gross domestic product expanded at a pace of 2.6 percent y/y, compared with expectations for 3.2 percent growth. And data released over the weekend showed China’s factory sector shrinking last month for the first time since 2012. Reuters quoted Phillip Futures investment analyst Howie Lee as saying that safe haven demand for precious metals is receiving a boost from an overall sense that “the global economy is not doing well”.
The price of silver for March delivery had shed two cents, or 0.14 percent, to $17.13 as of 06:33 GMT. Scotiabank notes in a report that the monthly data highlights the absence of a trend, with bearish momentum indicators appearing to be showing signs of moderation.
Based on the two most actively traded COMEX contracts, with a total volume of trade in gold and silver of 19,492 contracts as of 06:33 GMT today, the gold:silver ratio was at 74.70. On Friday, the ratio closed at 74.39.
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