The silver price in Australia has hit a one-month low and shows similar results as the gold price. Statistics have shown that silver was steady during the past 12 months, but now it is starting to decrease. The price isnt falling too low, and there is no reason to panic, says an expert silver investor and economist.
When the silver and gold price is investigated, we see that there is always a connection between these two metals when one is decreasing and increasing. In this case, the gold price first started to decline before the silver price followed.
The increase in interest rates might be the main cause
According to experts the main cause for the silver price, and the gold price for that matter, decreasing is because of the higher interest rate. It was announced that the interest rate will increase by 75 basis points in June. There are also indications that the interest rate will increase in July and then in September as well. Making the markets unsure and investors hesitant to invest in metals.
These interest rates might not occur in Australia, but in the US, influencing the world markets. The interest rates are increased by the US Federal Reserve, causing uncertainty. Uncertainty in the markets causes silver and gold prices to decline.
The LBMA report
With the bad news behind us, there is some good news as well according to the LBMA report. The London Bullion market association silver is on the path of recovering fast. The supply is manufactured on a regular basis again, after the Covid-19 pandemic that causes the world markets to be put on hold.
There are reasons to believe that the US Inflation Reduction Act will change during the next couple of months. And, this can have a positive change on the silver price in the US and other parts of the world like Australia.
The changes of silver recovering again
It is believed that the silver price will start recovering again, increasing to what it was, or even going higher than want it was during the past 12 months. However, in order for this to happen, the inflation and the production of silver need to recover more.
Should you buy or sell silver now?
New investors need to know if they should buy or sell silver now. Because of the low silver price, it is recommended that you start purchasing silver. A mistake that most people are making is to sell the moment that the markets are going down, and the price of silver is lower. However, you should be patient and wait. Your investment will grow, even if the silver price is at an all-time low.
What is influencing the silver price Australia, and can it recover again? You should make sure that you know what influences the silver price for future reference. Just because the silver price has decreased, it doesnt mean that it will recover soon.