Silver may test all-time high of Rs 75,000 a kg this year, say experts

Gold-silver ratio fell sharply indicating that the white metal is outperforming the yellow

Silver is taking centre stage after a huge rise in its prices over the past few days. So far in July, the metal’s price has jumped about 25 per cent and experts feel it could even touch its all-time high of Rs 75,000 per kilo, seen in April 2011.

On Thursday, silver closed at Rs 60,785 per kilo, a seven-year high, while standard gold closed at Rs 50,500 per 10 grams, its new all-time high.

This comes as investors look for a hedge against a possible rise in inflation as countries roll out stimulus packages in the wake of the Covid-19 pandemic. A weak US dollar and lower yields are also supporting prices, as escalating tensions between the two economic powerhouses are encouraging investors to buy US bonds.

 

 

Analysts say the ratio of gold price to that of silver has fallen sharply in the past few weeks. On Thursday, it reached 81-82, down from its lifetime high of 124 in March.

Ajay Kedia of Kedia Advisory, said, “Gold-silver price ratio has fallen sharply and is trading near 80. However, any further fall in the ratio from here, which is very likely in the next two and a half years, the ratio could fall to 60. We see further fall in the ratio, which means silver price testing its all-time high of Rs 75,000 is also possible and can happen as early as this year.” A further 25 per cent rally is required to push silver to Rs 75,000 per kg and that will come with profit booking and volatility.

MCX silver futures registered a seven and a half year high in daily turnover at Rs 32,994 crore, and gold futures registered their highest turnover of Rs 45,891 crore. Turnover of MCX silver options (30 kilo) also hit an all-time high of Rs 463 crore.