The spot price of silver in London has broken through the $62 mark for the first time on record, rising 1.3%. The move is being attributed to the US Federal Reserve’s 0.25 percentage point interest rate cut. Since the start of the year, the price of silver has climbed by more than 100%.
The Fed’s decision has weakened the US dollar, making precious metals, including silver, more attractive to international investors.
It is worth noting that the silver market has been facing a supply shortage for several years. Silver is widely used in solar panels, electronics, batteries and electric vehicles. With the energy transition accelerating, particularly in China, India and Europe, industrial demand is rising sharply, while mine output is struggling to keep pace.
Several major silver mines in Mexico, Peru and Bolivia have experienced production disruptions (strikes, higher extraction costs, new environmental regulations). This constrained supply is contributing to a supply-demand imbalance that is supporting higher prices.
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