SMM8 March 13: since the beginning of this year, silver prices have continued to fluctuate sharply, reaching a high of 6085 yuan / kg on February 2 and the lowest point of 4971 yuan / kg on March 31. After entering the second half of the year, the Shanghai silver futures price volatility fell, so far it fluctuated above the 5000 mark, approaching the lowest point this year. By the end of the day on Aug. 13, silver's main contract was 5085 yuan / kg, down 9% for the year. Meanwhile, spot SMM1# silver prices have fallen 9.73 per cent this year.
"Click to view the spot historical price of SMM precious metals.
Analysis of macro factors
Silver is an important industrial raw material, at the same time, it also has a strong financial attribute, deeply affected by the macro-economy. The dollar index has continued to rise since August, rising to 93.2 on August 10, a high in mid-to-late July. Silver has been under pressure to turn down since August until it began to fluctuate in recent days. At present, the market is closely watching the level of inflation in the United States, and if inflation is too hot, it may prompt the Federal Reserve to scale back its asset purchase program and raise interest rates in advance. Several Fed officials said the US economy was growing strongly and the labour market was rebounding, suggesting that the time for the Fed to start withdrawing support was approaching. But officials say the pre-crisis labour market may not be the best indicator of full employment because some people retire early and other structural changes have taken place in the labour market as a result of the epidemic.
Strong demand Global aggregate demand is expected to reach an eight-year high in 2021
Apart from macro factors, the demand for silver in the industrial sector is strong. According to relevant data, the total global demand for silver is expected to reach 1.025 billion ounces in 2021, an eight-year high, and industrial demand is expected to reach 510 million ounces in 2021, an increase of 9 percent over 2020 and a four-year high. As the metal with the best electrical conductivity, silver plays an irreplaceable role in the application of photovoltaic industry, mainly the positive silver and back silver of the battery. According to the World Bank, silver consumption in energy technology is likely to increase sharply to more than 50% of the current total silver demand by 2050. Among them, the focus is on photovoltaic, new energy vehicles and 5G networking.
Outlook for the future
On the whole, SMM believes that although the current global inflation expectations are strong, the impact on silver in the second half of the year may be very limited, but with the improvement of the US economy, the Federal Reserve will gradually put the reduction of QE on the agenda. Under the speculation of the market on reducing QE, the trend of silver prices in the second half of the year will probably fluctuate and fall widely.
2021 China International Silver Industry chain Summit Forum:
Focus on macro view and silver market analysis, application and technical guidance
What is the trend of supply, demand and price of silver market in the second half of the year? What are the opportunities? Welcome to participate in the 2021 China International Silver Industry chain Summit Forum organized by SMM, at which industry experts will make a comprehensive and in-depth analysis for the big family. Welcome to participate in this meeting to explore business opportunities and win-win future!
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