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Silver surges 5 percent on dollar and gold at record - ASHARQ AL-AWSAT English Archive
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SINGAPORE (Reuters) – Spot silver surged more than 5 percent to top $49 ounce on Monday, moving closer to its 1980 all-time peak lifted by a weak dollar and strong physical demand in Asia that also sent gold to a record high for a seventh consecutive session.

Spot silver was heading for its biggest daily gain in five months, hitting a 31-year high of $49.31 an ounce. It was trading at $49.07 as of 5:45 a.m. ET.

Spot gold hit a record high of $1,518.10 an ounce, before easing to $1,517.05. U.S. gold futures hit an all-time high at $1,518.6.

“Everyone is buying,” said a Hong Kong-based dealer. “There is stop-loss buying, as well as a good buying interest from China.”

U.S. silver futures jumped 8.2 percent to $49.82 an ounce in unusually large trading volume, just about 50 cents off its all-time peak of $50.35 hit on January 18, 1980. They stood at $49.11 as of 5:42 a.m. ET.

Silver prices have climbed nearly 60 percent this year, after jumping more than 80 percent in 2010.

That has outpaced gold’s 7 percent rise and a 10-percent gain in the 19-commodity Reuters-Jefferies CRB index and drawn investors big and small to silver.

Holdings in the largest silver-backed exchange-traded fund, iShares Silver Trust, have risen by 2.4 percent this year, while holdings in SPDR Gold Trust, the world’s top gold ETF, have declined by 4 percent.

Buying interest in physical silver has also jumped in India, where gold is traditionally favored.

“The rally has been great as traders are buying silver like mad,” said an official at a private bank in India.

“We normally don’t import silver on a regular basis, but we imported about 10 tonnes from last month. Investors are joining in the rally in India to catch on the price appreciation.”

“It’s the dollar play,” said a dealer based in Singapore.

The dollar index languished around its three-year low on Monday, with investors expecting further weakness as the upcoming Federal Reserves’ policy-setting meeting is likely to announce the continuation of low interest rates.

The escalated violence in Syria and Yemen over the weekend also helped lift gold, seen as a safe haven during time of turmoil.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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