Last week, silver spot prices broke downwards, falling sharply on Monday after risk averse sentiment boosted demand for the US dolar. Market players clearly expected a better solution than the one reached at the last Friday’s EU summit meeting and many opted for a selloff. Additionally, disappointment over no new QE measures announced by the Federal Reserve in the U.S. had investors rushing to increase safe haven holdings.
Silver prices fell early in the week but managed to post a marginal gain on Thursday. Altogether, silver futures log 8% loss for the week.
Precious metals continue to face pressure from depreciating emerging market currencies like the Indian rupee, thereby eroding the buying power of the biggest consumer.
Silver spot prices fell below the $30 mark for the first time since early October and were poised to post a 8% loss for the week, a second straight decline.
However, gains on Thursday and Friday helped limit the losses partially. With only weeks weeks left until the end of the year and no solution in sight for the European debt crisis, many analysts tend to expect silver prices to end down on the year, with silver ETF’s possibly posting its first loss since its inception in 2006.
The gold to silver ratio rose to 53.67 from 53.1 last week, after two previous consecutive weekly decreases.
