Over the current year, gold has increased in price by more than 7%.
At the same time, silver fell from $23.96 to $22.52 in the spot market, i.e., by almost 6%. What is the reason for this mixed movement, and should we expect the price of silver to turn around and begin to rise eventually? Let's talk about this in our article today. Gold-to-Silver ratio We studied the prices of silver and gold over the past ten years and conducted a regression analysis . It's no secret that the prices of these two metals are highly correlated.
If, from 2013 to 2015, the ratio remained consistently below the benchmark of 77, then from 2016 to 2019, the spread began to widen to 90-91 points. The fact is that the Fed started another cycle of rate hikes, bringing it to 2.5% by June 2019. The risk-off in the market led to an allocation to gold, which increased by 9%. However, the spread reached its greatest value precisely in 2020, when the FOMC sharply reduced the rate and launched QE. The gold-to-silver ratio has reached 112.
Gold Silver Price Increase Decrease Correlation Regression Analysis
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