Last week, the Russia-Ukraine conflict intensified, and a US Fed voting member expressed views indicating that next year's interest rates will be lower compared to this year. This led forecasters to raise the previously low December interest rate cut expectations to around 50%, which is bullish for silver.
[Economic Data]:
Bullish: The final value of the US November University of Michigan Consumer Sentiment Index was 71.8, lower than the previous value of 73 and the expected value of 73.7.
Bearish: The US EIA crude oil inventory for the week ending November 15 was 545,000 barrels; the US initial jobless claims for the week ending November 16 were 213,000, lower than the previous value of 219,000 and the expected value of 220,000.
[Spot Market]:
Silver: Last week, due to a large spot-futures price spread, traders' reluctance to sell increased. Coupled with the lack of absolute price advantage, smelters either exported or held back from selling. The market had limited spot cargo and warehouse warrants, leading to higher spot premiums. Large transactions were scarce, with downstream companies mainly accumulating spot orders, supplemented by some downstream companies and traders' just-in-time purchases. Due to the large spot-futures price spread, it was favorable for purchases, but the high spot premiums and prolonged spot-futures price spread led most companies to refrain from selling, resulting in a stalemate last week.
Downstream: As the year-end approaches, the market is clearing inventory, and the fluctuating silver prices have dampened enthusiasm for stockpiling. The market is making just-in-time purchases based on production needs.
