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Silver prices traded steady last week with moderate movement amid strong inflows in silver backed ETFs so far in 2022, while a strengthening US dollar checked prices from major gains.

Silver

Silver prices in LBMA gained 0.57 percent while COMEX silver gained 0.72 percent.

Silver exchange traded products (ETFs) started the year 2022 on a strong note, adding 50 million ounces to March

India’s silver supply increased by 8 percent yoy to 4,191 tonnes in 2021, but still below the pre-pandemic levels.

Silver prices steadied last week

Silver prices displayed a moderate performance in previous week, posting a mild rebound from preceding week’s fall. LBMA spot prices of silver inched up 0.57 percent and settled at USD24.75 an ounce. Silver spot prices in India’s domestic Mumbai market shed 0.45 percent to Rs.66500 per kilogram last week. In COMEX platform, the silver futures prices settled at USD 24.81 per ounce after gaining 0.72 percent in the last week. The near month MCX silver futures prices gained 0.39 percent WoW and settled at Rs.66992 per kilogram.

US Dollar index touch 100 marks again on Fed’s aggressive stance

The recent statements from some key Fed officials and the minutes from March months policy meet suggest central bank would firmly abide with its aggressive stance on tightening monetary policy in tackling inflation. US dollar index tested 100 marks last week overlooking more hikes in interest rates this year.

India’s Silver supply increases in 2021 after a slump in 2020; but still lower than pre-pandemic levels

India’s silver supply increased by 8 percent yoy to 4,191 tonnes in 2021, a modest rise considering the country’s high physical demand. The Covid-19 pandemic and subsequent rise in prices impacted demand hugely. When the market reopened post lockdown the wholesale market was initially sustained on local supply from mine production and scrap in. Imports had dried up and wholesalers offered silver at a huge discount to international prices. The market only came back to parity toward the end of last year, triggering higher monthly imports.

Silver backed ETFs see a strong inflows in Q1 of 2022

Silver exchange traded products (ETFs) started the year 2022 on a strong note, adding 50 million ounces to March. After an inflow of 346 million ozs in 2020, Silver ETFs added a measly 27.5 million ozs in 2021. The global economic recovery made safe-haven assets like gold and silver less attractive last year, which prompted a selloff in ETFs.

iShare Silver ETFs inflows rise in April

Total physical holdings of Silver backed ETFs with iShare silver trust increased by 1.38 percent so far in April after an increase of 2.31 percent in March and 2.30 percent in February. The total physical holdings in silver with iShare silver trust is more than 566 million troy ounces in the week ended April 8.

COMEX Money Managers trim net longs in Silver F&O

Data from U.S. Commodity Futures Trading Commission (CFTC) showed that the hedge funds and money managers reduced bullish positions and incrased the bearish positions in COMEX silver contracts and the net long positions declined in the week ended April 8.

Outlook

The short term trend continues to be choppy with mild negative the safe haven appeal of the precious while metal remains feeble due to improved global economic sentiments. A strong US dollar, steady global equities and US Federal Reserve’s decision to hike interest rates too dimmed the appeal of silver. However, a possible industrial demand pick up, especially from China, may dent major downside in the metal.

COMEX: Expect a choppy trade inside $29.90-23.80 levels initially and breaking any of the sides would suggest fresh directional moves to the commodity

MCX: Expect a tight trade inside Rs 74500-60500 levels initially. Anyhow, breaking any of the sides would suggest a fresh short term direction to the commodity.

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