Silver Declines According To Data

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Silver Declines According To Data

Silver Declines To $29.33, According To Data

decline was seen in the Silver (XAG/USD) prices on Thursday, which was 1.34% lower. Earlier, the Silver (XAG/USD) trading price was $29.73, which has now gone down towards $29.73.

Despite the short-term weakness in Silver (XAG/USD), the precious white metal is still up by 15.16% since the start of the year 2024.

Gold/Silver Ratio Moves Higher

look at the Gold/Silver ratio shows that it has gone up from around 78.21 to near 78.93. This ratio is used to figure out how much silver (troy ounces) is needed to buy Gold (1 troy ounce).

This measure is used by investors to figure out the relative value of Silver and Gold. In general, a higher reading of the ratio is a sign that Silver (XAG/USD) is undervalued or the Gold is overvalued. This enables the investors to buy Silver/Gold accordingly.

Given that the Gold/Silver ratio has gone up in the last few days, it is a sign that Silver is undervalued. In other words, gold has become overvalued relative to silver. Similarly, a low ratio is a sign of undervaluation of Gold relative to Silver.

The recent decline in the Silver (XAG/USD) is mostly due to the recent CPI reading and hawkish comments from the US Federal Reserve. A similar move was seen in gold and other metal commodities in the last few days.

The current environment in the USA requires fewer rate cuts than initially forecasted. In simple words, the interest rate will remain elevated with only a minor rate cut this year. Such conditions may be ideal for the USD but not so much for the Silver, Gold, & other metals.

Overall, a softening of the US CPI and weakness in the US labour market are the two key factors which can lift Silver (XAG/USD) towards the next targets at $30, $30.20, $31, and $32.00.

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