Silver prices surged to an unprecedented peak above $60 an ounce in early trading on Wednesday, outstripping gains in gold as investors bet on tightening supplies and cheaper valuations. The rally was buoyed by expectations that the US Federal Reserve would cut interest rates later in the day.
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Spot silver climbed to a record $60.9125 a troy ounce, while March futures reached $61.430. The white metal has more than doubled in price this year, significantly outperforming gold, on forecasts of constrained supply in the coming months. Its designation as a critical mineral by the US government has further bolstered its investment case.
Silver’s relative affordability compared with gold, which has also enjoyed a strong rally, has spurred additional buying interest. It is increasingly viewed as a viable, lower-cost haven asset.
Gold also advanced on Wednesday, aided by a softer dollar as markets anticipated a 25-basis-point rate cut from the Fed at its final meeting of the year. Lower interest rates tend to enhance the attractiveness of non-yielding precious metals.
The Fed’s decision, due shortly, will test whether this bullish momentum can be sustained.
