Global Sentiment Drives Silver to Significant Increase
Silver prices recorded significant gains on Monday, fueled by a combination of macroeconomic factors and global market sentiment. Silver reached $47.18 per troy ounce, up approximately 1.9% compared to last week's close. This surge also emphasized that the white metal—aside from being an industrial asset—remains viewed as a safe-haven asset amid global uncertainty.
The fundamentals underlying this increase stem primarily from expectations that the US Federal Reserve will cut interest rates in the coming months. Lower interest rates would lower the opportunity cost of holding non-profit assets like silver, thereby increasing its appeal to investors. Furthermore, the structural supply deficit continues to exert pressure on the global silver market. According to a report from Metal.com, the silver market has been experiencing tension between growing industrial demand and limited supply.
However, this positive momentum also carries the risk of a correction. Some analysts warn that the silver market has entered overbought territory, which could trigger profit-taking if upcoming US economic data surprises or the Fed's interest rate decision is more hawkish than expected. A strong strengthening US dollar or signals of monetary tightening could dampen the silver rally in the short term.
Source: Newsmaker.id
