Hot Commodities: Silver melts to three-week low, sentiments hurt amid a collapse in Copper

COMEX Silver futures slumped yesterday amid firm US dollar and continued reversal from a around 14-year highs extended. The metal has been rising impressively in recent times on supportive demand trends. The Silver Institute had noted at the start of the year that global silver market is forecast to record another significant deficit (total supply less demand) for the fifth consecutive year in 2025. Silver industrial demand will remain the key driver of this favorable supply-demand scenario. Global silver demand is expected to remain broadly stable in 2025 at 1.20 billion ounces, as gains in industrial applications and retail investment will be mitigated by weaker jewelry and silverware demand.

However, with the US dollar index soaring to two-month high, there has been a huge correction in the white metal over last week or so. The inability of the metal to take out $40 per ounce on a conclusive manner has led to a sharp drop with the metal sliding around 3% in intraday moves. The US Federal Reserve held interest rates steady between the range 4.25% to 4.5% and Fed chief Jerome Powell said that the central bank has not made any decisions about September rate decision yet. This pulled down precious metals heavily while Copper also tanked around 18% after the US President Donald Trump exempted refined material from new tariffs on the metal. Silver continues to fall today and currently trades down 1.35% at $37.23 per pound. This is the lowest level in three-weeks for the commodity. On the MCX, Silver futures are trading at Rs 111602 per kg, down 1.10% on the day.

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