price of silver
Thanks to that "party animal" Ben Bernanke, silver prices today are enjoying a nice bounce.
That's because the U.S. Federal Reserve chairman, along with the other members at the Federal Open Market Committee (FOMC) meeting yesterday, decided to keep the quantitative easing (QE3) flowing steady with $85 billion of bond buying per month.
After the Fed announcement, silver prices rallied by 5.5% to more than $23 an ounce. That's the precious metal's biggest one-day gain since June 28.To continue reading, please click here...
What You Need to Know About Silver Prices and the Fed QE Taper
Silver prices have rebounded about 28% since the lows of late June, and are currently trading at around $23 an ounce.
This move was key for silver prices - it means the metal broke out above its 50-day moving average.
Barclays' technical analysts pointed out that last week was silver's best week since 2011, with a gain of 14.3%.
Will Silver Prices Keep Falling?
Our Money Morning resources expert Peter Krauth explained the reasons behind gold's fall, so we went back to him to find out the deal with silver prices. Will silver keep falling? Is it a buy at the lower levels?
Here's what Krauth offered for investors.
Money Morning Staff: Peter, are silver prices falling because gold fell, or are there other factors at play here?
Peter Krauth: There are two factors.The first is that silver follows gold rather closely, and usually amplifies its behavior, both up and down. However, it can and does sometimes detach from gold and behave independently, but this is more of a rarity.
The second is silver's industrial demand.
With the White-Hot Demand for Coins, Why Are Silver Prices Falling?
It's one of the biggest mysteries in finance right now.
I mean, it's a real head-scratcher ...
On one hand, demand for silver coins has been off the charts. With so many investors wanting to swap currency for silver, neither the U.S. Mint nor the Royal Canadian Mint has been able to keep up with purchase requests.
In fact, the U.S. Mint actually had to suspend sales of the "Silver Eagles" just a couple of weeks into the New Year - and it still smashed the all-time monthly sales record in January by selling 7.5 million of the hugely popular coins.
And that insane demand carried over into February and March.
Is London Manipulating Gold and Silver Prices?
As we've explained before, manipulation of gold and silver prices is happening right here in the United States.
Our Global Resources Specialist Peter Krauth interviewed silver market analyst Ted Butler last year, who explained how big financial institutions were using high-frequency trading to depress silver prices.