PRESS ROOM
Silver is buoyed by gold and industrial metals
Thursday 26th January '23
Silver often exhibits a leveraged relationship with gold. We experienced this in the twelve months after the March 2020 Covid crash in markets when silver meaningfully outperformed gold while both metals rallied. In 2022, things went in the other direction. As gold’s sentiment deteriorated, investor sentiment towards silver fell even further. But since November, once again, gold’s recovery is enabling silver to bounce back even more strongly. Silver is, of course, affected by the dynamics of industrial metals as well given more than half of its demand comes from industrial applications. This was also a factor for its lacklustre performance last year as industrial metals were pricing in a slowdown in China and recessionary fears across major economies more widely. If in 2023, China’s lockdowns are lifted for good and the economic engine starts firing again, fuelled by accommodative monetary policy, this could be the catalyst for the recovery of industrial metals. It could also spur silver’s rally further.