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Silver prices today (Friday) were modestly higher as bargain hunters stepped up to buy the dips. In early trading, spot silver last traded up $0.11 to $20.45.
It's been a volatile and punishing week for silver.
In morning trading Thursday, silver futures for May delivery slumped 2.3% to $20.355 an ounce, on pace for the biggest drop since March 7. That put white metal prices heading for their fourth consecutive day of losses, the longest streak since Nov. 13.
Thursday's rout was blamed on U.S. Federal Reserve Chairwoman Janet Yellen, who gave investors concern over a sooner-than-expected interest rate hike at this week's Federal Open Market Committee (FOMC) meeting.
Yellen said Wednesday the central bank's stimulus program could end this fall, and benchmark interest rates could rise about six months later. Policy makers also continued with tapering, cutting monthly bond buying by $10 billion to $55 billion.
Quantitative easing and rock-bottom interest rates have been a catalyst for silver since 2008. Silver prices started to slip in May 2013 after the first mumblings of a taper.
Yellen's comments sent the dollar soaring against all major currencies. A stronger dollar makes silver more expensive in other currencies, which can weigh on demand.
Also pressuring the white metal this week are what seem to be easing tensions between Ukraine and Russia.
Crimeans cast ballots Sunday overwhelmingly in favor to leave Ukraine and join Russia. Things were relatively quiet in the Ukraine city following the vote. Thursday, Ukraine said it plans to reinforce its eastern border with Russia and withdraw troops from Crimea, in effect ceding control of the Black Sea peninsula.
That took some of the fear premium out of silver.
Silver had marched higher in recent weeks as investors stocked up on the safe-haven, store-of-value asset amid geopolitical anxieties. Silver is seen as a hedge against political and economic uncertainty because it tends to retain its value during periods of instability.
But selling silver based on this week's scenarios is likely to be an overreaction.