Silver rates surged today in Indian markets today, extending their recent gains. Today, on MCX, silver futures were up ₹817 or 1.6% to touch ₹51,000 per kg. On Friday, silver rates had surged about ₹1,500 per kg. Analysts attributed the spike in silver prices to optimism that industrial demand of the metal may revive as countries reopen their economies.
Analysts say that global efforts to restart economies could boost silver demand, making prices of the metal, which slipped to an all-time low relative to gold during the crisis, likely to rebound strongly.
"MCX silver crossed ₹50,000 mark comfortably as gold/silver ratio has cooled down from 114 (1st May 2020) to 97 as on today. Silver on the MCX gained by 23% in May and we believe same momentum to continue for some more sessions," said Jigar Trivedi, research analyst at Anand Rathi Shares and Stock Brokers.
In comparison, gold has shown a flattish to higher to higher over the past one month. Currently, MCX gold futures trade near ₹47,000 per 10 gram.
In a note, Geojit Financial Services said silver prices will continue with positive bias as it holds above $17.60. "Further resistance is seen at $18.90, a direct rise above the same would be a sold signal for major bullish waves. Weakness is expected only a break below $15.80. "
MCX silver has support at ₹47,400, Geojit added.
In global markets, silver today jumped 2% to $18.20 per ounce, its highest since February 26, before retreating slightly to trade 1.8% higher at $18.16.
"Supporting gold and thereby silver price is US-China tensions. ETF inflows also show buying interest," Kotak Securities said in a recent note.
Silver may witness choppy trade and while overall bias is on upside, it added.