On May 17, the price of silver hit $31.49 an ounce for the first time since 2013, up 6.5% on the day and 32% year-to-date, becoming one of the year’s best-performing commodities.
About this write Bloomberg.
Such rapid growth in silver prices is due to increased investor interest, a favorable macroeconomic background and an expected shortage in the market. An additional impetus was the general increase in metal prices on Friday.
Money managers increased their bullish bets on Comex silver futures to the highest level in more than two years. As of May 14, gross short positions held by these investors accounted for 11% of total shares outstanding, according to Bloomberg data.
Record gold purchases by central banks, rising retail demand in China and expectations of lower interest rates in the US also supported silver prices. While investor interest in silver-backed exchange-traded funds remained weak, physical sales increased.
According to the Silver Institute, due to significant growth in the industry, this year’s use of the metal will reach a record level. Against this background, the market is facing a deficit for the fourth consecutive year, and this year’s deficit is the second largest in history.
