What Is Keeping Down Silver?

The price of silver dropped again last week, even though gold rallied. Will gold pull back up silver in the near term? Let’s review the latest developments in the silver market and examine the main news that could stir up the bullion market.

During the previous week, silver fell by 2.1%. The silver ETF iShares Silver Trust (SLV) also dropped by 1.7%. Conversely, other silver assets have done well last week: Silver related companies such as Silver Wheaton (SLW) and Pan American Silver (PAAS) rose by 1.9% and 2.4%, respectively.

Silver and gold

Following the last publication of the non-farm payroll report, in which 209 thousand jobs were added, gold rallied while silver slipped. This report was lower than expected and may have contributed to the weakness of the equities market and recovery of gold. Moreover, the linear correlation between gold and silver has slightly declined, as indicated in the chart below.

The chart shows the linear correlation between silver and gold is currently at 0.76, which is still a very strong and positive correlation. But this relation is also the lowest since March.

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