Global growth outlook, performance of USD, industrial demand will set a bearish direction for silver – Silver prices rose to a four-month low, spending more than 8 percent since the start of the year. The weak demand for secure goods amid signs of a slowdown in the global economy, strong US resilience and reducing fears of Delta’s Covid-19 divergence has reduced the attraction of secure assets such as bullion. Rising U.S. financial resources have also saved precious metals.
London prices are widely traded at a tight range within $ 24-30 ounce throughout the year. It started trading at $ 26 an ounce and went up to $ 30 in February, but was later adjusted. A similar trend has been observed in the domestic market where MCX futures prices fluctuate within Rs 74,000-Rs 62,600 per kg range since January this year.
The US dollar continues to remain strong compared to its key competitors after recovering from several months. A strong dollar has saved the feeling of secure goods like bullion. The increase in US Treasure currency has had a profound effect on metals. Expectations that the US Federal Reserve will keep its prices very low to fund the economy during the resurgence of new cases of the virus, forced the U.S. Treasury to be more productive.
The attention of traders has now shifted to the Federal Open Market Committee (FOMC) to find new ways. The US Fed had indicated a slow take on the current state of residential policy in June, but investors struggled to interpret the signals from the combined comments from the central bank.
Also read : Stock prices for Ashoka Buildcon by connecting a Rs 600-crore contract
The Fed has also failed to give a timeline for the adoption of its economic stimulus measures at a recent meeting held this week. The largest bank in the United States has admitted that they have discussed the final withdrawal of financial policy support provided during the epidemic, but are awaiting a major recovery in the labor market. Measures taken by major banks to stretch their momentum will always support the bullion trend.
Silver prices have been very volatile in the past year as unusual developments have led to significant fluctuations in the demand for steel commodities. However, iron ore has gained momentum by 2020 due to interest rates for asset commodities and declining mining production. Significant losses in demand have been reported from jewelry, silver and industrial acquisitions but such deficiencies have been replaced by healthy regeneration in physical investment.
According to the Silver Institute, global demand for silver is expected to rise by 11 percent to reach a six-year high of 1.025 billion ounces this year. The agency sees a significant increase in investment demand by 2021.
Meanwhile, the capture of iShares Silver Trust ETFs, the world’s largest silver ETF is expected to drop for the second consecutive month in July. Total holdings of ETFs are currently set at 552.27 million compared to their record high of 615.899 million in February. According to the US Commodity Futures Trading Commission, hedge fund managers and financial managers have reduced their bullish positions and added bearish positions to the COMEX silver contract in recent weeks.
Looking ahead, industrial demand in all sectors is likely to register profits due to the rapid industrialization of industrial growth in China and European countries. Global commodities could also register growth as the mines recover from Covid-19 disruption. However, retailers are looking at global economic outlook, monetary policy, yields and the performance of the U.S. dollar to set a medium-term asset direction.
Ahead of the price, COMEX prices may vary within $ 30-22 ounce in the near future and breaking either of the sides may suggest a new direction in the middle. At MCX, it has to break and support more than Rs 75,000 to start large circles. The low turn key point is reflected in Rs 62,000 a kg.
