Silver price today: Silver falls, according to FXStreet data

Source Fxstreet
Apr 10, 2024 09:13

Silver prices (XAG/USD) fell on Wednesday, according to FXStreet data. Silver trades at $28.08 per troy ounce, down 0.26% from the $28.15 it cost on Tuesday.

Silver prices have increased by 10.25% since the beginning of the year.

Unit measure Today Price
Silver price per troy ounce $28.08
Silver price per gram $0.90

 

The Gold/Silver ratio, which shows the number of troy ounces of Silver needed to equal the value of one troy ounce of Gold, stood at 83.83 on Wednesday, up from 83.57 on Tuesday.

Investors might use this ratio to determine the relative valuation of Gold and Silver. Some may consider a high ratio as an indicator that Silver is undervalued – or Gold is overvalued – and might buy Silver or sell Gold accordingly. Conversely, a low ratio might suggest that Gold is undervalued relative to Silver.

Global Market Movers: Comex Silver price defends $28.00 amid escalating geopolitical risks

  • Silver price on Comex gains ground on expectations of Fed rate cuts in 2024.
  • The non-yield asset like Silver appreciates as US Treasury yields decline.
  • The price of Silver follows the upward movement in Gold prices, supported by increased consumer and industrial demand. 
  • Israel's Foreign Affairs Minister, Israel Katz, affirmed that Israel would retaliate if Iran attacks its territory.
  • The escalating geopolitical tensions in the Middle East are driving investors towards safe-haven assets like Silver.
  • Investors adopt a cautious stance, anticipating potential policy shifts influenced by the incoming US CPI data. 
  • The US inflation data could likely have a significant impact on the US Dollar-denominated XAG/USD.

(An automation tool was used in creating this post.)

Inflation FAQs

Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.

The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.

Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.

Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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