Daily Gold Market Report

Silver’s Catch-Up
The Underlying Factors Behind its Lagging Performance

(USAGOLD – 11/3/2023) Gold is surging on Friday due to a lackluster jobs report, diminishing the likelihood of a Fed rate increase in December. Gold is trading at $2,000.55, up $14.77, and Silver is trading at $23.17, up 41 cents. The gold/silver ratio is at its highest peak since March 2023 (when it reached 91:1), indicating that gold’s performance has significantly surpassed that of silver. While gold has seen an 9% increase year-to-date, silver has declined by 5.4%. Nevertheless, silver has shown signs of recovery, with an approximate 7% rise in the past month.

“Clearly, silver is not profiting from the demand for safe havens to the same extent as gold,” commodity analysts at Commerzbank said in a note on Tuesday. “Industrial use accounts for somewhat more than 50% of total silver demand. As a result, the silver price tends to perform less well than the gold price at times of increased risk aversion and associated economic concerns.”

USAGOLD Comment: The gold/silver ratio, which indicates how many ounces of silver it takes to buy an ounce of gold, is currently hovering around 87:1. Historically, over the past 25 years, it has averaged closer to 60:1, with a notable move all the way to 32:1 in April of 2011. It is also worth noting that prior to that move, exactly one year earlier (April 2010) the ratio sat at 65:1.