Stefan Gleason Blog | Why Isn’t Retail Demand For Silver Pushing Up Prices? | Talkmarkets
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Gleason is president of Money Metals Exchange, a national precious metals investment company and news service with over 450,000 readers, 35,000 paid customers, and $120 million in annual sales. He launched the company while president of a national newsletter publishing ... more

Why Isn’t Retail Demand For Silver Pushing Up Prices?

Date: Friday, February 19, 2021 1:31 PM EDT

 

Metals markets continue to diverge this week, with copper and platinum adding to recent breakout gains while gold struggles to find footing.

 

During this week’s selloff, gold revisited its lows from last November. A support level exists at $1,750, but momentum selling could take prices down a bit further before technical gauges flash deeply oversold signals.

 

Turning to silver, the white metal continues to show relative strength versus gold, although prices haven’t actually moved much over the past few trading days.

 

Despite lackluster returns in most of the precious metals so far in 2021, inflation pressures are pointing upward.  On Wednesday, the Labor Department reported that U.S. wholesale prices surged by 1.3% in January.  

 

Rising costs for health care and energy led the bigger-than-expected increase.  It was the largest single month rise in producer prices in more than a decade.

 

That made inflation a hot topic on CNBC.

 

CNBC Anchor #1:                            This morning, we got a major warning sign         about inflation. Producer price is climbing more than expected in January.

CNBC Anchor #2:                            That question of, could there really one day actually be a return of inflation? Are we already pouring fuel on a pretty hot fire to begin with? Given people are getting back to sort of life, a lot of the country already is, but that return to normalcy, the spending that will come along with that, and then $1.9 trillion on top of that. And by the way, potentially an infrastructure bill following on that.

CNBC Market Commentator:         And the Fed, of course, is trying to engineer inflation, and has been trying to prepare investors for the idea that they are going to be tolerant of significantly higher inflation, for some time to come, to essentially counterbalance all this time we've spent under their target of 2%.

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