KOLKATA: Silver prices have increased 7 per cent in the past one month as demand has picked up in markets such as China and the United States. In contrast, gold prices have appreciated just 1.17 per cent during this period. Analysts, however, said silver prices are likely to go up further.
Silver traded at Rs 73,500 per kg in the spot market on Tuesday, up from Rs 68,894 per kg a month ago.
“The rally in silver is gaining momentum as there is more depth in silver than gold,” said Surendra Mehta, national secretary, India Bullion & Jewellers Association. “While gold prices have already reached $ 1,880 per troy ounce from the low of $ 1,673 per ounce, silver prices have moved in a narrow range. There is a renewed buying interest in silver due to green energy as most of the industries are now using this.”
The Silver Institute, a US-based research firm, said in a report that the global silver demand will rise this year to its highest since 2015 as jewellery and industrial offtake rebounds after the Covid-19 pandemic.
Silver is used in the manufacturing of goods from solar panels to consumer electronics, besides being bought by investors who traditionally see it as a safe store of wealth.
The pandemic triggered a rush of investor stockpiling but curtailed demand from industry and jewellers, particularly in India, one of the most important markets.
“Silver, as a metal, can be used for jewellery, artefacts and for industrial purposes, unlike gold,” said Hareesh V, head of commodity research at Geojit Financial Services. “So, as a metal, its appeal is more. The current rise in prices is due to the weakness in the dollar and positive data from China. Also, silver is now at $ 28.47 per ounce. It has a resistance level at $ 30 and if it breaks it, then it can go up further.”
Gold, on the other hand, is losing steam. “As vaccination picks up across the globe, the price rise trend in gold has weakened a bit,” he said.