- Silver prices rise slightly as the persistent uncertainty about commercial conversations between the US and China drives the demand for shelter assets.
- President Trump confirmed that the negotiations are ongoing, but said that there are no scheduled conversations with Chinese President Xi Jinping this week.
- A weaker US dollar is increasing the attractiveness of assets called dollars such as silver for foreign investors.
The price of silver (XAG/USD) is leaving its four -day drop, quoting about 32.10 $ during Monday’s Asian session. The precious metal is recovering land as the uncertainty continues around the commercial conversations between the US and China feeds the demand for safe refuge.
On Friday, the Ministry of Commerce of China said that a proposal from the United States (USA) is considering to resume commercial discussions. This happens after US President Donald Trump said the negotiations were underway, although he clarified that there are no scheduled conversations with Chinese president Xi Jinping for this week.
The US dollar (USD) has also weakened, increasing the attractiveness of assets called dollars such as silver for holders of other currencies. The dollar is under pressure, partly due to the escalation of commercial tensions, with Trump announcing plans for a 100% tariff on the films produced abroad.
However, the industrial demand prospects of silver are cloudy by the deterioration of global economic data. The US economy contracted 0.3% in the first quarter, its first decrease in three years, while the manufacturing PMI of the NBS of China fell to a minimum of 16 months, driven by the most pronounced fall in export orders since 2022.
The market approach now moves to the next monetary policy meeting of the US Federal Reserve, where it is widely expected that the rates are kept without changes despite the renewed impulse of Trump for a cut. Investors are also attentive to the publication of the ISM services of the US ISM on Monday to obtain information about economic perspectives.
Plata FAQs
Silver is a highly negotiated precious metal among investors. Historically, it has been used as a value shelter and an exchange means. Although it is less popular than gold, operators can resort to silver to diversify their investment portfolio, for their intrinsic value or as a possible coverage during periods of high inflation. Investors can buy physical silver, in coins or bullion, or negotiate it through vehicles such as the funds quoted in the stock market, which follow their price in international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can cause the price of silver to shoot due to its safe refuge status, although to a lesser extent than that of gold. As an asset without performance, silver tends to climb with lower interest rates. Its movements also depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (XAG/USD). A strong dollar tends to maintain the price of silver at bay, while a weaker dollar probably drives rising prices. Other factors such as investment demand, mining – silver supply is much more abundant than gold – and recycling rates can also affect prices.
Silver is widely used in the industry, particularly in sectors such as electronics or solar energy, since it has one of the highest electrical conductivities of all metals, surpassing copper and gold. An increase in demand can increase prices, while a decrease tends to reduce them. The dynamics in US economies, China and India can also contribute to price fluctuations: for the US and particularly China, its large industrial sectors use silver in several processes; In India, the demand for consumers for precious metal for jewelry also plays a key role in pricing.
Silver prices tend to follow gold movements. When gold prices go up, silver typically follows the same path, since their status as shelter is similar. The gold/silver ratio, which shows the number of ounces of silver necessary to match the value of an ounce of gold, can help determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that silver is undervalued, or that gold is overvalued. On the contrary, a low ratio could suggest that gold is undervalued in relation to silver.
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