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Silver hits eight-year high as GameStop buying frenzy moves on

Silver has gained almost 19% since Thursday when posts started circulating on Reddit urging small traders to purchase silver mining shares.

Reuters

UPDATED ON FEB 01, 2021 08:32 PM IST

Silver prolonged its blistering rally for a 3rd session on Monday, hovering as a lot as 11.2% to a close to eight-year peak as retail traders piled into the metallic in a frenzy kicked off by US social media customers final week.

Spot silver was up 9.4% at $29.53 an oz. by 1418 GMT, having earlier hit its highest since February 2013 at $30.03.

Silver has gained almost 19% since Thursday when posts started circulating on Reddit urging small traders to purchase silver mining shares and exchange-traded funds (ETF) backed by bodily silver bars in a bid to duplicate a squeeze on GameStop.

“It is laborious to say how far this will go. It is all about momentum; if the futures market additionally will get behind this transfer, they might add gasoline to the hearth, so the New York open can be very attention-grabbing,” mentioned Ross Norman, an unbiased analyst.

Commerzbank analyst Eugen Weinberg mentioned in a notice that within the medium time period, any extreme worth rise is dangerous for silver as it may harm bodily demand.

Silver ETFs and mutual funds noticed their largest inflows in 5 months in January, Refinitiv Lipper information confirmed.

Holdings in iShares Silver Belief ETF, the biggest silver-backed ETF, jumped by a document 37 million shares from Thursday to Friday alone, every representing an oz. of silver.

Spot gold jumped 1% to $1,864.01 per ounce, whereas US gold futures rose 0.9% to $1,866.90.

Specialists warning that gold’s comparatively subdued efficiency suggests silver’s rally might not final lengthy. An oz. of gold at the moment buys 63.2 ounces of silver, versus 73.Three ounces on Jan. 25.

The market consideration silver is receiving “highlights silver’s traditionally low worth vs. gold”, mentioned Gregor Gregersen, founding father of Silver Bullion Pte Ltd, calling the latest retail frenzy a “welcome demand catalyst.”

Platinum gained 3.9% to $1,114.09 and palladium rose 1.4% to $2,256.29.

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