Silver prices surged to a nearly 12-year high on Thursday, riding the momentum of gold’s unprecedented rally. Interest rate cuts by major central banks fueled renewed investment in precious metals. Spot silver increased by 0.6%, reaching $32.03 per ounce in the early afternoon trading session, marking its highest level since December 2012. The metal briefly hit $32.71 per ounce before easing slightly.
This surge in silver is part of a broader trend in the precious metals market, driven by consecutive rate cuts by central banks around the world and prolonged economic stimulus measures, particularly in China. These factors have bolstered demand for silver, both as a safe-haven investment and a vital industrial material. Analysts predict that silver prices could climb higher, with projections suggesting it may approach the $37 level in the coming months.
Silver’s remarkable rise this year—more than 35% year-to-date—has closely mirrored gold’s record-breaking performance. The strong correlation between gold and silver has often resulted in the two metals moving in tandem, with silver following the path of gold’s ascent. This relationship is reflected in the gold-to-silver ratio, which measures how many ounces of silver are needed to buy an ounce of gold. The ratio has decreased as silver prices have gained strength, indicating silver’s growing value relative to gold. The ratio is around 82, further underscoring silver’s rapid climb.
Beyond the investment appeal, the industrial demand for silver has also significantly contributed to its price rise. Silver’s use in photovoltaic products, such as solar panels, has surged, with demand nearly doubling from the previous year. The metal’s unique properties make it indispensable for various industries, especially as the global shift toward renewable energy drives growth in sectors like solar energy.
Meanwhile, gold continued its rally, rising by 0.5% to $2,670.52 per ounce and hitting a new record high of $2,685.42 earlier in the day. Gold futures for December delivery closed higher at $2,694.90. Gold has surged over 29% in 2024 alone, smashing through multiple record highs as investors flock to the safe-haven asset amid expectations of further U.S. interest rate cuts, increased geopolitical tensions, and robust central bank gold purchases.
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