Silver prices climbed to $65.5 per ounce on Wednesday, their highest level in two months, after the US Treasury announced it would double its buyback operations for long-term securities. The move sparked a sharp decline in longer-dated Treasury yields and complemented other efforts by the department to ease pressure at the long end of the yield curve, including intervention in the yen market and urging the Federal Reserve to raise limits on the FIMA facility. Lower borrowing costs enhance the attractiveness of holding non–interest-bearing precious metals.
Industrial demand also underpinned silver prices. Chinese imports of silver-bearing ores surged 62.5% year-on-year in June to 219,000 tonnes, consistent with expanding production in solar panel manufacturing and electricity grid infrastructure. Even so, persistent risks of a renewed spike in energy prices kept silver trading relatively near the seven-month low of $55 per ounce reached on July 16.
