Silver Surges Towards $60 as Oil Prices Fall
Silver prices surged on Monday to within reach of $60 an ounce as oil and dollar prices fell, providing relief for precious-metals traders.
The sharp retreat in oil prices gave traders a reason to look beyond the immediate geopolitical risk and refocus on interest rates. Spot silver climbed 2.8% to $59.81 in early Asian trading, extending a broader metals rally as gold moved above $4,100.
Silver's rebound was stronger than gold's because it also trades as an industrial commodity, making it more sensitive to changes in economic sentiment. A reduction in immediate Middle East tensions improved the outlook for manufacturing and global demand, while cheaper energy eased concerns about rising production costs.
A weaker US dollar provided another tailwind, lowering the cost of silver for buyers using other currencies and improving demand across the wider metals market. However, the latest advance still needs to attract follow-through buying, as a brief improvement in geopolitical sentiment may not be enough to sustain the rally if the dollar rebounds or investors begin reducing commodity exposure again.