Silver Lags Gold as Covid Haven Due to A lot Larger Industrial Demand
SILVER PRICE, GOLD – TALKING POINTS:
- Gold and silver are each regularly cited as having counter-riskproperties
- However silver’s demand profile is skewed way more towards industrial demand
- This sees it performing extra like a cyclical asset than gold when instances are powerful
Silver costs have underperformed these of gold because the coronavirus has come to completely dominate market sentiment.
Whereas gold costs stay elevated, underpinned by that all-too-understandable haven bid, silver costs are properly down for the yr up to now. Certainly, nonetheless nursing falls of round 16% they’re behaving relatively extra like risk-correlated fairness than any kind of bet-hedging haven asset. Gold alternatively is up by greater than 10%.
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The rationale behind this discrepancy is that, whereas each gold and silver are clearly valuable metals, priced by the ounce relatively than the tonne, their demand profiles are actually very completely different.
Estimates of commercial demand for silver differ, however…