Most recent article: Silver price today: Silver falls, according to FXStreet data
Silver prices (XAG/USD) rose on Tuesday, according to FXStreet data. Silver trades at $28.07 per troy ounce, up 0.79% from the $27.85 it cost on Monday.
Silver prices have increased by 10.22% since the beginning of the year.
| Unit measure | Today Price |
|---|---|
| Silver price per troy ounce | $28.07 |
| Silver price per gram | $0.90 |
The Gold/Silver ratio, which shows the number of troy ounces of Silver needed to equal the value of one troy ounce of Gold, stood at 84.02 on Tuesday, up from 83.99 on Monday.
Investors might use this ratio to determine the relative valuation of Gold and Silver. Some may consider a high ratio as an indicator that Silver is undervalued – or Gold is overvalued – and might buy Silver or sell Gold accordingly. Conversely, a low ratio might suggest that Gold is undervalued relative to Silver.
Global Market Movers: Comex Silver price rises above $28.00
- Silver price follows the rally in gold as global central banks increase their reserves.
- The price of Silver has advanced to its highest level since June 2021.
- The eased geopolitical situation in the Middle East could limit the advance of Silver price.
- The demand for non-yielding assets like Silver is bolstered as US Treasury yields correct after two days of gains.
- The industrial outlook for metals received a boost from strong manufacturing data from top consumer China and projections for increased solar installations.
- Traders eagerly await the release of the US Consumer Price Index inflation data due on Wednesday for a fresh US Dollar price action, eventually impacting XAG/USD.
(An automation tool was used in creating this post.)
Inflation FAQs
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
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