Silver’s golden run continues; trades at ~57,000 on MCX

Silver is becoming the new gold. The price of the white precious metal touched ~54,850 per kg in the spot market after rallying 4.8 per cent on Tuesday. On the MCX, September futures are trading above ~57,000 per kg. Since March-end, silver has given 39 per cent return to investors as against gold’s 14.3 per cent. The metal is now fast approaching the ~60,000-mark.

On the other hand, gold closed 0.5 per cent higher at ~49,579 per 10 gram in the spot market on Tuesday. On the MCX, the yellow metal was trading at ~49,200 per 10 gram. The gold-to-silver price ratio, which reflects the relative strength of these metals against each other, has now decreased to 88.8. It had reached as high as 124 early this calendar year.

“Increasing Covid-19 infection, supply concerns, and hopes of further stimulus have supported silver’s safe-haven demand and pushed its international price to a nearly four-year high of $21 an ounce. Support from Comex silver, too, help the price surge. Still, silver is likely to continue its bullish run despite overbought readings,” said Ajay Kedia, Kedia Advisory, Mumbai. The international gold price was around $1837 an ounce.

Generally, the silver price follows gold’s. Recently, the gold price had touched a new high of ~49,348, and now silver is following the trend and heading towards new peak.

Anuj Gupta, AVP, Angel Broking, said: “Industrial demand increased globally. ETFS, too, are supporting silver. The holding of the biggest silver ETF – Blackrock’s ishares Silver Trust, has surged by $2.45 billion to $9.72 billion this year. In India, a good monsoon is also one of the reasons for the increase in the price of silver. Demand for silver jewellery from rural areas has also supported the metal. We expect silver to test ~60,000 levels soon. Festival demand is also supportive.”