Silver Holds Near 14-Year Peak

Silver traded above $69 an ounce on Monday, hovering at a two-month high, as concerns over US debt management and fiscal sustainability persisted after the Treasury unexpectedly ramped up buybacks of longer-dated government debt. The intervention pushed bond yields and the dollar lower, reviving the debasement trade and boosting silver’s appeal as an alternative store of value. On the geopolitical front, threatened new US sanctions on Iran are raising the risk of further disruptions to Iranian oil supplies, potentially pushing energy prices higher and limiting the scope for interest-rate cuts. Investors will now focus on July PCE inflation data and Fed Chair Warsh’s Jackson Hole speech for further clues on the US rate outlook. Meanwhile, Canada’s planned retaliatory tariffs on some US goods after trade talks collapsed add to broader economic uncertainty.

Silver traded above $68 an ounce on Friday and was on course for a third consecutive weekly gain, as investors turned to safe-haven metals amid heightened volatility across currency and bond markets, while rising oil prices continued to underscore inflationary risks. The precious metal jumped more than 5% this week after the US Treasury Department announced plans to at least double its long-term debt buybacks in an effort to contain borrowing costs, driving Treasury yields and the dollar sharply lower. Silver also pushed higher even after Treasury yields reversed Wednesday’s decline amid concerns that the government’s efforts to rein in long-term borrowing costs may provide only a temporary solution. Meanwhile, oil prices extended their advance as the US prepares sweeping new economic sanctions against Iran, with the two sides locked in a standoff over the Strait of Hormuz.

Silver prices rose to $68.2 per ounce on Wednesday, the highest in two months, on strong industrial demand and support from a reignition in the debasement trade. The US Treasury announced it would double the buyback of long-term maturities, adding to other efforts that limit the surge in longer ends of the curve. Besides lowering borrowing costs, the signal that the federal government is actively attempting to supress yields lifted the outlook on dollar liquidity, raised risks on higher deficit spending, and turned investors to repivot toward hard assets that defend across a lower purchasing power. In turn, industrial demand for silver also supported bids. Chinese imports of silver-bearing ores surged 62.5% annually in June to 219,000 tonnes, in line with an expanding production for solar panels and electricity grids to accommodate for the soaring electrification trend pushed by the central government.