[Price Review] During the week, silver prices first fell and then rose. After the release of US initial jobless claims data, traders no longer bet on a US Fed interest rate cut in 2026. At the same time, traders also raised their bets on further ECB rate hikes, seeing a 75% probability of a third hike this year. At the start of the week, affected by the escalation of the Middle East conflict and the continued rise in oil prices, the bearish atmosphere in precious metals continued. LBMA spot silver once plunged by more than 13%, falling below the $66 mark and hitting a new low since February 6. Mid-week, as the US pushed to end the conflict with Iran and Trump-related remarks boosted market sentiment, expectations emerged for easing geopolitical tensions in the Middle East, and gold and silver prices briefly rebounded in catch-up gains. In terms of the gold/silver ratio, as of March 26, the LBMA gold/silver ratio was 62, and is expected to maintain fluctuating trend in the short term.
[Important Data]
Bearish:
US API crude oil inventory for the week ended March 20 was 2.348 million barrels, lower than the previous reading but higher than expectations
US EIA crude oil inventory for the week ended March 20 was 6.926 million barrels, higher than both the previous reading and expectations
Data and macro releases to watch next week include:
March 26 (Thursday), Fed Chairman Powell, along with multiple governors and voting members, will deliver speeches, and attention should be paid to their latest remarks on inflation, the labor market, and the impact of tariff policies
March 28 (Friday): US February core PCE price index (the inflation indicator most closely watched by the US Fed)
April 3 (Thursday): US March nonfarm payrolls report, unemployment rate, and average hourly earnings
Multiple US Fed officials will speak next week, including Fed Governor Barr, Milan, Jefferson, San Francisco Fed President Daly, and Philadelphia Fed President Paulson↗
These speeches will provide important clues on the direction of US Fed monetary policy, especially their stance on inflation, employment, and interest rate policy.
The OECD will release its first comprehensive economic forecast since the outbreak of the Middle East war, and the IMF will release its World Economic Outlook report in mid-April, which will incorporate an assessment of the impact of the Middle East conflict on the global economy.
The Middle East conflict is still ongoing, and the latest attacks indicate that the conflict is evolving into an energy conflict. Damage to or even destruction of infrastructure will trigger a longer-term supply crisis and cause a more severe shock to the global economy. The threat to navigation through the Strait of Hormuz remains unresolved, and oil prices are staying above $100 per barrel, which may affect precious metal prices through inflation and recession channels.
[Price Forecast] In the short term, macro disturbances remain the main factor affecting silver prices. The pullback in oil prices has eased concerns over inflation and rate hikes, providing some support for short-term precious metal price movements. On the fundamentals side, in late March, rigid-demand raw material procurement by silver nitrate enterprises and other electronic and electrical end-user enterprises declined, while industrial end-users bought cautiously amid fears of further price declines, leaving demand support relatively weak. In China's spot market, circulating supply of spot silver ingots remained ample. As China spot premiums were lowered, the import window gradually closed, and the pressure from short-term silver ingot inventory accumulation slowed down. The period of abnormally high China spot premiums has ended, but due to factors such as supplier costs and reluctance to sell, spot market premium quotes for silver ingots remain firm. However, if weaker silver prices drag down market investment demand or trigger selling for cash, spot premium quotes are still expected to continue to pull back. Downstream silver prices are still expected to remain in the doldrums, but close attention should be paid to disruptions to market sentiment from changes in geopolitical conflicts and adjustments in capital flows.
![[SMM Silver Morning Review] Market Sluggish, Slight Premiums Amid Weak Demand; Shanghai Sees Limited Transactions](https://imgqn.smm.cn/usercenter/SSKOK20251217171734.jpeg)
