InvestorQ : Why have silver prices rallied so sharply in the month of May 2020?
Arya Nanda made post

Why have silver prices rallied so sharply in the month of May 2020?

Answer
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Deepa Salunkhe answered.
3 months ago


Silver prices have been on an uptrend for the last one month with the MCX silver futures scaling Rrs.51,000 per kg. This can be largely attributed to the spike in silver prices on the back of optimism that industrial demand of the metal may revive as countries reopen their economies. Most of the demand for silver still comes from industrial uses, unlike gold, which is more policy and fear driven. Also the gold/silver ratio has sharply skewed in favour of gold and that made silver underpriced in relative terms. In the month of May alone, silver has gained close to 23% on the back of sustained momentum buying in the metal. In contrast, gold has been more flattish in the month of May. A lot of silver ETFs across the world are seeing enhanced buying of silver.