Last week, silver prices changed a little after trading in a very narrow range.
Still, the white metal closed 4.13% higher, after losing nearly 30% of its value in the four weeks prior. Market players opted to hold on to less risky assets as they wait on the outcome of the European debt crisis to provide them with clearer views of how to place their trades.
Spot silver dropped to a low of $31.396 on Tuesday as North American markets opened after a holiday on Monday. The combined effect of a stronger USD and equity losses in markets also played a role in pulling prices lower on Thursday. In order to cover the losses from equities, some traders had to reduce their precious metal holdings.
Silver prices are more volatile during economic slowdowns in advanced economies compared to gold, mainly because of the dual purpose the white metal bears.
However, silver is poised to close in the positive territory for the second consecutive week, though it may face pressures with a major Russian silver miner announcing a third quarter production of more than 40%.
The gold to silver ratio also crept up to 52.34 from 51.7 last week, with the bulk of the increase coming from gold.
