The return of industrial activity backstage amidst the deepening outbreak at Corona has added to the silver lustre. On Thursday, silver prices touched a new seven-year high in the domestic futures market. Silver has become somewhat brighter than yellow metal on expectations of increasing industrial demand. Bullion market experts point out that the trend of investors is more towards silver than gold at this time. Silver prices in India have been hovering above Rs 53,000 per kg since 2013 while gold is currently hovering above Rs 49,000 per 10 grams. At the same time, silver is above $ 19 an ounce in the international market while gold is running above $ 1800 an ounce.
Commodity market experts point out that the ratio of gold and silver prices is decreasing again, which indicates that instead of gold, the trend of investors has increased towards silver. Increased investment demand for expensive metals in the Corona period has led to a tremendous rise in the prices of gold and silver in the domestic and international markets as well and now the gradual opening of lockdown around the world and the return of industrial activity back to the silver lustre has increased much.
The September futures contract for silver on the Multi Commodity Exchange (MCX) was trading at Rs 52877 per kg, down Rs 181 from the previous session on Thursday, while the previous time, gold was trading at Rs 49090 per 10 grams, with a weakening of Rs 69 from the previous session in the August contract, while the previous price rose to Rs 49245. The gold price on MCX jumped to Rs 49348 per 10 grams on July 8, 2020, which is the record level. A day ago, 24-carat purity gold was running at Rs 49250 per 10 grams in the spot market. At the same time, silver was trading at Rs 52,195 per kg. GST is not included in the spot price.
National Secretary of the Indian Bullion and Jewelers Association (IBJA) Surendra Mehta said that silver is an industrial metal and prices are seeing upward in anticipation of increasing demand in the industry as the lockdown opens. However, he says that while the price of gold has broken slightly from its height, which is a momentary decline, there is a fast forward trend.
Ajay Kedia, director of Kedia Advisory, said that when the price of silver had risen above Rs 70,000 per kg in 2013, then the ratio of gold and silver price had come down to 31, while in March this year the ratio went up to a historical high of 127, But then the ratio has come down to 93, indicating that instead of gold, the trend of silver in investors. One of the main reasons for the sharp rise in silver is the trend of investors towards precious metals due to the corona outbreak. At the same time, the industrial demand for silver is also always there.
Kedia said that according to the Silver Institute, investment demand for silver has increased by 10 per cent in the first half of 2020 and its industrial demand has increased since May after initial weakness. He added that the Silver Institute also estimates that supply from silver mines will be seven per cent less in 2020, especially when industrial demand is around normal.
