Silver prices have been stable lately amid constant market volatility

Silver prices have recently been seeing a moderate movement lately amidst high market volatility, reflecting various global economic and industrial factors. Prices saw a sharp increase over the past week, hovering around $30.20 per troy ounce during European trading hours. This rally has largely been driven by a weakening US Dollar, which makes silver more affordable for international buyers. The depreciation of the dollar often boosts the appeal of precious metals, as they become cheaper for holders of other currencies.

Another key driver has been the demand surge from China, the largest consumer of silver globally. In an effort to revitalize its slowing economy, China has implemented measures such as interest rate cuts to stimulate borrowing and investment. These policies have bolstered demand for silver, which is widely used in industrial applications like electronics, solar panels, and electric vehicles. As China’s economy shows signs of recovery, its role in maintaining strong silver demand has been significant.

However, prices recently experienced a pullback. This decline was influenced by rising US Treasury yields, which tend to reduce the appeal of precious metals that do not offer interest income. Additionally, strong labor market data in the United States, including unexpected job growth and a drop in the unemployment rate, has tempered expectations for monetary policy easing. This shift has created temporary downward pressure on silver prices.

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Despite the recent dip, the market remains under a structural supply deficit, with demand for silver outpacing production. Higher mine outputs and increased recycling efforts have slightly eased the deficit, but robust demand for industrial and jewelry applications continues to support the metal’s value.