Silver prices in local and global markets declined during Monday’s trading, following their ascent to historical highs last week. This comes amidst a wave of sharp volatility in global financial markets, driven by renewed trade tensions between the US and China, the ongoing US government shutdown, and increasing expectations of interest rate cuts by the US Federal Reserve, according to a report issued by the "Safe Haven" Research Center.
The report clarified that silver prices in the local market dropped by about 5 EGP during today's trading. The price for 800-karat silver recorded 76 EGP per gram, 925-karat was around 88 EGP, while 999-karat reached 95 EGP. The price of the 925-karat silver pound stabilized at 704 EGP.
This retreat follows a week of strong gains, as local silver prices rose by 11% last week. The 800-karat gram climbed from 74 to 81 EGP, the 925-karat reached 94 EGP, and the 999-karat hit 101 EGP, with the silver pound settling at 752 EGP.
Globally, silver prices fell by about $2, recording $52 per ounce, after touching $55 on October 16th, which was the highest price in the modern history of the white metal. This record high was supported by increased demand for safe havens and supply shortages in global markets.
According to data from the "Safe Haven" Center, silver achieved a 10% rise globally last week, climbing from $50 to $55 per ounce, supported by rising geopolitical and economic concerns and expectations of US interest rate cuts.
CME FedWatch Tool data indicates that markets are pricing in a 99% probability of the Federal Reserve cutting interest rates by 25 basis points at the October meeting, with an additional 96% chance of a second cut in December. This reinforces expectations of continued accommodative monetary policy in the coming months.
Analysts at the "Safe Haven" Center believe that silver may regain its upward momentum in the coming weeks, especially given clear indications that major central banks are moving towards monetary easing, and the increasing flow of investors into non-yielding assets like gold and silver.
The US government shutdown has continued for the third consecutive week without a political agreement to end the crisis. The Senate failed to pass the funding bill for the tenth time last week, making this shutdown the third longest government closure in modern US history.
Observers believe that the continuation of the political deadlock in Washington reinforces market fears of a potential economic recession, prompting investors to redirect their portfolios towards safe havens, primarily gold and silver.
US Treasury Secretary Scott Bessent is scheduled to meet with Chinese Vice Premier He Lifeng in the coming days in preparation for an anticipated summit between Presidents Trump and Xi Jinping later this month.
Despite this cautious opening, the US administration described China's restrictions on rare earth metal exports as a "major obstacle to resuming trade dialogue," while Beijing responded by imposing additional tariffs on American ships, bringing back the spectre of a trade war and its potential impact on global growth.
In light of these developments, Bank of America raised its silver price forecast to $65 per ounce by 2026, with a target average of $56.25, attributing these estimates to increasing investment flows into the white metal and rising industrial demand in the solar energy and electronics sectors.
Conversely, Goldman Sachs warned of a potential short-term price correction in the silver market, noting that the metal is characterized by higher volatility than gold due to its reliance on industrial demand, which could be negatively affected in the event of a global economic slowdown.
Saxo Bank, however, predicted that silver will continue its ascent towards $100 per ounce by 2026, supported by increasing industrial demand and the global shift towards clean energy.
Experts agree that silver remains poised for new waves of rallies, especially with increasing factors supporting demand in both the industrial and investment fields. However, they simultaneously warn against the recurrence of the rapid correction waves that characterize this sensitive metal.
Follow the latest news on Google News
