Silver futures drift higher; suppliers hold offers firm, spot trades sluggish [SMM daily review]

Today, SMM's 10:00 a.m. price for SGE Ag (T+D) was 15,999 yuan/kg, with the premium/discount range quoted at TD+5 yuan to +15 yuan/kg and a weighted average price of 7.31 yuan/kg. As the spot-futures price spread between SHFE and SGE T+D widened, the premium was raised from the previous trading day.

On the macro front, although the rate hike was implemented with a hawkish bias, the market digested it quickly, showing a "buy the rumor, sell the fact" pattern. The US dollar index pulled back after shooting up above the 100 mark, and the 10-year Treasury yield fell about 9 basis points to around 4.93%. Combined with easing geopolitical tensions and falling oil prices, this supported precious metals futures to hold up well, with silver showing greater elasticity than gold and posting more significant gains.

In the spot market, morning quotes in Shanghai were concentrated at a discount of 25-20 yuan/kg against the most-traded SHFE 2610 contract. The spot-futures price spread between SHFE and SGE T+D widened, running at 35-40 yuan/kg. With silver prices rising and most downstream buyers having restocked sufficiently in recent days, overall purchasing sentiment was weak today. Suppliers held back from selling and held prices firm. As the holiday approached, some suppliers suspended quoting altogether. Overall quoted price spreads were relatively small, and buyers favored lower-priced cargoes. Bargaining over the premium range was evident, and most deals after negotiation leaned toward the lower end of quotes.

Overall, silver prices returned above 16,000 yuan. As futures rose, the spot-futures price spread between SHFE and SGE T+D widened, and spot market trading was sluggish. Today's premium/discount quotes against the most-traded SHFE 2610 contract remained at a discount of 30 to 20 yuan/kg, with transactions concentrated in the small premium range for SGE Ag (T+D).