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Silver reached the pinnacle of its popularity in May 2011, but September is depicting an opposite picture for this precious metal. The current year 2011 has seen investors fall in love with silver as if they have been with no other metal. The preciousness of the metal had been growing with passing days, crouching as an alternative to gold whose accessibility was questioned at times. Silver was at its best behavior until September 2011, when it showed its true colors of volatility – slipping more than any other precious metals did. Silver prices were going strong up to May when it peaked to a high of $48 per oz. However, the third quarter was not so auspicious for the investors when prices on silver declined by nearly 15% over the period. The result was lost of all the gains it had amassed since the start of the year. On the other hand, big bro gold was not doing so good as well following the footsteps of silver by plummeting from above $1,900 to below $1,600 per oz in a matter of less than three weeks during the month of September. However gold’s nature was surpassed by silver’s volatility that fell by nearly 27% in the same month. For most of the time, investors look toward precious metals as a safe store of investment over concerns of deprecating global economy and deteriorating Euro zone crisis. In these days of crisis what exactly is happening to the precious metals that are losing away their crown of a safe investment option? It seems that, the weak US economic data and EU policy inactions are to blame for the decline in the prices in mid-September resulting into a free fall a week later. Investors panicked to cover their losses in the equity and currency markets by selling their stakes in gold, silver, and holding paper cash. Since then, the gold and silver prices have rebound by taking lessons from the US dollar and economic data, but commodity analysts are still unsure about the stability of the prices. There have been stories about the silver prices to remain range-bound in the near term taking signals from the movement of industrial metals in the market. Yet, analysts fear depicting a positive picture for precious metals in the background of economic issues since industrial use of silver eats up half of the metals total demand. With slow economic growth, silver is bound to face a fall in prices. However, there are groups of analysts who are upbeat on silver prospects as they consider the current low prices will call in for more buying opportunities. In addition, loose monetary policy regimes in progressed economies, silver & gold are bound to make a strong return. The author is a veteran journalist in silver market, mining & stocks, who periodically writes articles related to silver prices, silver spot price including tips on investment in silver. Please visit silverprices.com for more details.
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