Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Silver Charts Biggest Single-Day Gain Since 2016

  by    0   0

Gold pushed above $1,500 again Wednesday (Aug. 7) and silver joined the party, charting its biggest single-day gain in nearly three years.

Silver surged 73 cents on the day for a 4.4% gain, closing above the key $17 level for the first time since January 2018.

Silver has gained about 9.3% on the year.

Continued trade war woes and more central bank easing helped drive both gold and silver higher.

New Zealand’s central bank cut interest rates by 50 basis points to 1.50%. According to a Reuters report, the move caught markets off guard. As a result, the Kiwi plunged as much as 2.1% against the US dollar. The Reserve bank of India dropped rates for the fourth straight meeting, and Thailand’s central bank also initiated a surprise rate cut.

Meanwhile in the US, Chicago Fed President Charles Evans hinted at more Fed rate cuts.

You could take the view, as I have, that inflation alone would call for more accommodation than we put in place with just our last meeting. You might take the view that things have perhaps created more headwinds against that, and it would be reasonable to do more.”

Jerome Powell insisted the July rate cut wasn’t the beginning of a long easing cycle, Peter Schiff said Powell was right. That’s because it won’t take long to get to zero.

It doesn’t have a lot of ammunition to cut rates, and so I think we’ll get to zero relatively quickly. And we’ll stay there until the Fed completely loses control of this thing.”

Analyst Edward Moya told MarketWatch he expects the rally in gold and silver to “roll on” especially when the Fed cuts rates again.

Gold captured the $1,500 an ounce level and the rally seems set to roll on as no one is expecting any immediate progress on the trade front and the proactive easing efforts from central banks globally. When the Fed capitulates later this month that could be the catalyst to support the drive towards the $1,650 an ounce level.”

Silver’s big move up is a good sign for both the silver and gold market. The white metal began to play catch-up with gold in mid-July. After pushing close to 93-1, the silver-gold ratio began to close as silver rallied. At the time, Peter said this also indicates to him that the bull market in gold is about to kick into a higher gear.

One of the aspects of the bull market that hadn’t kicked in was silver. You see, normally in a bull market in gold, silver outperforms. I mean, it happens in every bull market, but it hasn’t happened yet. And what I’ve been saying is the reason for this is I think a lot of investors were still very skeptical that we were in a bull market. They were concerned that the breakout was going to be false. They didn’t believe it, so they were not really buying silver.”

Now they are buying silver.

As Peter has pointed out, we have all the elements in place for a gold bull market and historically, silver outperforms gold in this environment.

At the time of this report, the silver-gold ratio was at 87.7-1. While this is a healthy improvement from the 93-1 levels we were seeing early last month, it’s is still a significant spread. Keep in mind, the modern average over the last century is around 40:1. This tells us that silver remains significantly undervalued compared to gold. In effect, we still have silver on sale. If you look at how cheap silver is compared to gold, the upside has probably never been this great.

Get Peter Schiff’s key gold headlines in your inbox every week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

Ireland Adds Gold to Reserves as Inflation Worries Increase

Over the last several years, we’ve seen strong central bank gold-buying. The surge in gold purchases has primarily been driven by a handful of consistent players. But over the last several months, we’ve seen several new countries enter the market. The most recent is Ireland.

READ MORE →

That Was One Weird Jobs Report

That was one weird jobs report. The labor department released the November employment data on Friday. The numbers simply don’t make any sense. As one chief investment officer put it, “One of the weirdest reports I have ever seen.” One thing seems pretty certain. The labor market has not recovered, no matter how the powers […]

READ MORE →

Gold Demand Continues to Rebound in India

Gold demand in India strengthened in October despite higher prices. This continues a rebound in the world’s second-largest gold market after it was pummeled by government policies during the coronavirus pandemic.

READ MORE →

I’m Dreaming of a Red Christmas?

It appears American consumers are going to have a red Christmas this year. Red — as in going deeper into debt.

READ MORE →

Singapore Adds Gold to Reserves for the First Time in Over 2 Decades

Singapore expanded its gold reserves by about 20% earlier this year, joining a growing number of countries increasing their investment in the yellow metal.

READ MORE →

Comments are closed.

Call Now