Monday 4 March 2013

“Some investors who want precious metal exposure are looking to silver as a cheaper substitute for gold”

LONDON (Commodity Online): The scenario of silver coin demand outstripping gold coin demand cannot be ruled out as there exists "considerable interest in Silver Eagles in Europe as well as North America," according to Robin Bhar, head of metals research, Societe Generale.
He also said that the investor appetite for silver on all fronts, institutional and retail, is sufficient to absorb the metal's surplus. “Some investors who want precious metal exposure are looking to silver as a cheaper substitute for gold” he said to Kitco as demand for coins and ETPs climb.
Net investment into ETPs of silver is continuing and now stands at $650 million, with a daily average of $15.7 million; up 32% from a year ago.
He, however cautioned that "the market remains volatile and vulnerable to profit taking, however, and is unlikely to tighten, suggesting that profit taking into strength would be the preferred course of action."
Meanwhile stable US Dollar Index coupled with low crude oil prices have offset the advantage posed by short covering and some mild bargain hunting.
Silver for delivery on May 13 was seen trading at $28.708 a gain of $0.212 or 0.74% as of 10.54 AM IST.
Obama has signed into law a spate of spending cut measures in US, popularly known as sequestration. This brings into effect some $1.2 trillion in cuts over a decade; $85 billion this year itself.
This has made the economic ambience a bit uncertain supporting gold and silver. Meanwhile Cyprus having sought bail out is also being closely observed.
On India's MCX, silver for delivery on May 04 was seen trading at Rs.54853, a gain of 0.04%.

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