Silver Extends Year-To-Date Slide as Spot Price Declines

Spot Silver Moves Lower
Silver prices (XAG/USD) fell on Friday, according to FXStreet data. The metal was quoted at $65.06 per troy ounce, a decrease of 0.99% compared with the $65.71 level recorded on Thursday.

From the start of the year, silver prices have now dropped by 8.47%, extending their year-to-date decline.

Why Investors Look at Silver
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.

Main Drivers of Silver Prices
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.