Silver Breaches Rs 9000, Inches Towards 6 Yr-High

White metals prices vaulted over the Rs 9000 level yesterday. Silver .999 recorded a rise of Rs 320 a kg to Rs 9,010 and shows signs of inching towards a 6-year high of Rs 9,390 a kg ,quoted on January 16, 1992.

Raw silver .916 also followed suit and increased by Rs 255 to Rs 8,835 a kg. Silver prices in the Mumbai market have surpassed the previous high of Rs 8,510 a kg quoted on December 24, 1997.

Silver prices in the London market crossed $7 level to touch $7.10 an ounce during trading yesterday.

"The main reason for this surge is speculative buying by an active syndicate consisting of some banks and commodity traders at the London market," a market analyst said.

 

According to a leading bullion dealer, the paucity of ready stock and restricted arrivals have sent the white metals to run into a shortage of physical stock.

S P Sonawala, director of National refinery Pvt Ltd, said "This is nothing but speculation by a syndicate consisting of banks, financial institutions and commodity traders to pull prices to the level of $9.00 an ounce. Of course, the present shortage of ready stock has also pushed the market sentiment". These movements have reduced warehouse stocks on New York's Comex futures market to 12-year lows of 12.14 million ounces.

According to informed sources, the customs department is likely to sell silver at higher prices which might force to prices to dip under the level of Rs 9,000.