Silver prices have repeatedly hit new highs recently. According to data from the Korea Gold Exchange, the price of silver on the 17th was 2,467 won (about 12 yuan) per gram.At the beginning of the year, the cumulative increase has been 70%, higher than the gold increase in the same period. South Korean investors' demand for silver has increased dramatically, leading to market supply tensions.
On one street in the precious metal district of Seoul, South Korea, hundreds of sales stores gathered, and seventy percent of precious metal goods in South Korea are traded here.Reporters' field visits found that in recent years, business abnormalities exploded here, even in the afternoon of the working day, customers who asked for prices and funds were endless.
Xiao Ming, the head of a precious metal sales store in Seoul, South Korea, said that in recent years the gold price has continued to run high, but investing in gold requires more capital, which also leads many Korean consumers to start paying attention to the price of silver and its related products, such as silver beads, silver cards, etc. Since October this year, their store's silver beads order volume has reached two tons, 10 times higher than in the same period last year.
Since this year,Cumulative sales of silver bars from major commercial banks in South Korea were 10.4 billion won (approximately RMB 52.08 million）, 13 times higher than the same period last year。Due to the shortage of silver bars in the market, Korean commercial banks and large precious metal sales platforms announcedSilver bullion sales will be suspended from the 20th of this month。
Since this year, international cash prices have surpassed gold.
Since the beginning of this year, silver prices have been soaring. This is driven by multiple factors, including tightening liquidity in the London market, rising risk aversion among investors, and growing industrial demand.
Since this year, silver has surpassed gold.Recently, the international cash price has also broken the threshold of $50 per ounce, becoming the focus of the market. The key reason for driving this wave is at the heart of the global precious metal market, and the London cash market is experiencing a period of severe liquidity tension.
The liquidity of the silver market depends on hundreds of millions of ounces of silver stored in London vaults. However, this stock has been continuously depleted in recent yearsInitially, because of the insufficient supply of minerals, it is difficult to meet the needs of investors and industries such as photovoltaics; and this year, due to concerns about potential tariff risks, a large number of precious metals have been shipped to the United States, further escalating the tension in the London market.
Since mid-1,London's silver inventories have dropped by about a thirdAnd a considerable part of it is held by trading fund ETFs for a long time. According to Bloomberg calculations, the current stock available for free circulation in the market is only about 200 million ounces, a sharp reduction of about 75% compared to about 8,500 million ounces during the peak period in 2019.
Against the background of tight liquidity, many traders who previously bet on the decline of silver prices, that is, short positions, are now forced to buy back silver at a higher price to close their positions in order to stop losses or respond to margin calls.As more empty heads were forced to shelter, this empty movement also caused the purchase of silver plates to rise, and the price was further pushed up.。
Give up the trading factors of the financial markets and go back to the basics of demand.Silver not only serves as a valuable storage function, but also has industrial usesThis year, global trade tensions, the Federal Reserve's independence in question, and factors such as the U.S. government's "stagnation", have aggravated market uncertainty, and also pushed up investor demand for hedge assets, so that precious metals have become one of the outstanding asset categories.
In addition, according to Citigroup's forecast:It is expected that industrial uses will be the largest source of silver demand this year, with an estimated 4.3 billion ounces.Among them, the demand for the solar industry is listed separately, at about 2,99 billion ounces, reflecting that the renewable energy sector is becoming a major driver of growth in demand for silver.
John Champagalia, CEO of global asset management company Sprott: We believe that silver is in the midst of a "catch-up market" and there is still a lot of room for growth.
With regard to future trends, Goldman Sachs pointed out that the liquidity tightening of silver is a major driver of its recent surge, but this tightening is expected to be temporary. Because the rise in London’s current currency prices are stimulating the “return” of silver from the United States and elsewhere to London. In addition, because silver is not supported by the demand of central banks like gold, analysts warn that the expected volatility of silver and the risk of price decline is greater than gold.
Come toThe Source:Central Finance