FX.co ★ Silver Holds Above $32 Threshold

Silver prices hovered around $32.4 per ounce on Tuesday, experiencing modest gains for the second consecutive session. This upward trend represents a year-to-date increase of approximately 12%, driven by heightened demand for silver both as a bullion investment and for its industrial applications. Precious metals continue to be bolstered by the prospect of lower interest rates from major central banks, which diminish the opportunity cost associated with holding non-yielding assets. Recent softer inflation data has led to expectations of two interest rate cuts by the Federal Reserve this year. Similarly, the Bank of England has reduced its benchmark rate, and the People’s Bank of China has lowered the rate on liquidity operations. Concurrently, increased investment in solar panels, a primary industrial application for silver, has spurred continued purchasing by manufacturers. New findings indicate that China's wind and solar capacity reached nearly 1,500 GW in the first quarter of the year, spurred by a 60GW increase in photovoltaic power. Moreover, solar power output in Europe saw a 30% annual rise in the first quarter.