Silver Prices: Volatile Week Continues for the Grey Metal

London (July 11)  After bouncing around between gains and losses at the start of the week, silver prices resumed their descent on Tuesday, a sign that the grey metal was losing its luster.

Silver for September settlement dipped 14 cents, or 0.9%, to $15.49 a troy ounce at 7:27 a.m. ET. Prices fluctuated between $15.43 and $15.68 through the overnight session.

The grey metal reversed heavy losses on Monday to finish with gains of 1.3%. At the end of last week, silver briefly plunged 11% in futures trading before recouping most of its losses throughout the day. CME Group confirmed the volatile swing.

Silver’s volatile drop has elevated the gold/silver ratio, which is currently hovering near 15-month highs. The ratio, which is used by investors to determine when to buy and sell precious metals, closed at 77.81 on Monday. It reached 78.63 on Friday – its highest since April 2016.

Gold prices were trading slightly lower through the early-morning session, with the August futures contract slipping 0.3% to $1,209.80 a troy ounce. Bullion’s declines in recent weeks have been more subtle, but have nevertheless materialized in four-month lows.

An absence of fundamental drivers suggests precious metals are losing their luster – at least, for the time being. Analysts caution that geopolitical risks on the Korean peninsula may trigger renewed buying interest in precious metals. It’s also important to note that silver has repeatedly rallied in the wake of a sharp rise in the gold/silver ratio.

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