Silver slides from 3-month high as investors cut fund holdings
Silver dropped after a rally to a three- month high spurred some traders to sell and as investors cut their holdings of the metal to the lowest in more than two years.
By Bloomberg |
Silver dropped after a rally to a three- month high spurred some traders to sell and as investors cut their holdings of the metal to the lowest in more than two years. Gold was little changed.
Investors sold 113.3 metric tons from silver-backed exchange-traded products in the past two days, the most since June, data compiled by Bloomberg show. Holdings, now at 18,951.3 tons, are set for a sixth straight weekly decline, the longest run since 2013.
Prices climbed in the previous five days as patchy U.S. economic data prompted traders to bet that the Federal Reserve will wait until next year to raise interest rates for the first time since 2006. Higher borrowing costs curb the appeal of precious metals, which don’t pay interest or give returns like other assets such as bonds and equities.
"The rally in prices over the past few days has proven a very tempting selling opportunity for long-term investors," Adrian Ash, head of research at BullionVault, an online trading service, said by phone from London. "Sentiment towards precious metals remains weak given the expectations of higher rates in the U.S., and that’s encouraging investors to sell silver ETFs."
Silver Prices
Silver for immediate delivery dropped 2.3 percent to $15.6895 an ounce by 11:44 a.m. in London, according to Bloomberg generic pricing. Prices reached $16.123 on Wednesday, the highest since June 23. The metal is little changed this year.
The Fed will release minutes from its September meeting later Thursday. Traders put the probability of a rate increase this year at 38 percent, while the odds rise to 59 percent for a move in March, according to Fed fund futures data compiled by Bloomberg.
Gold traded little changed at $1,145.11 an ounce in London after touching the highest in more than a week on Wednesday. Holdings in gold-backed funds fell 1.2 tons to 1,529.5 tons as of Wednesday, down for a second day.
Platinum lost 0.7 percent to $938.94 an ounce and palladium added 0.1 percent to $697.30 an ounce.
Investors sold 113.3 metric tons from silver-backed exchange-traded products in the past two days, the most since June, data compiled by Bloomberg show. Holdings, now at 18,951.3 tons, are set for a sixth straight weekly decline, the longest run since 2013.
Prices climbed in the previous five days as patchy U.S. economic data prompted traders to bet that the Federal Reserve will wait until next year to raise interest rates for the first time since 2006. Higher borrowing costs curb the appeal of precious metals, which don’t pay interest or give returns like other assets such as bonds and equities.
"The rally in prices over the past few days has proven a very tempting selling opportunity for long-term investors," Adrian Ash, head of research at BullionVault, an online trading service, said by phone from London. "Sentiment towards precious metals remains weak given the expectations of higher rates in the U.S., and that’s encouraging investors to sell silver ETFs."
Silver Prices
Silver for immediate delivery dropped 2.3 percent to $15.6895 an ounce by 11:44 a.m. in London, according to Bloomberg generic pricing. Prices reached $16.123 on Wednesday, the highest since June 23. The metal is little changed this year.
ADVERTISEMENT
The Fed will release minutes from its September meeting later Thursday. Traders put the probability of a rate increase this year at 38 percent, while the odds rise to 59 percent for a move in March, according to Fed fund futures data compiled by Bloomberg.
Gold traded little changed at $1,145.11 an ounce in London after touching the highest in more than a week on Wednesday. Holdings in gold-backed funds fell 1.2 tons to 1,529.5 tons as of Wednesday, down for a second day.
Platinum lost 0.7 percent to $938.94 an ounce and palladium added 0.1 percent to $697.30 an ounce.
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
ADVERTISEMENT
