The German DAX index has climbed to yet another record close-of-trade figure, but one notable commodity losing ground was silver. Precious metals have been sliding in recent months, albeit after a meteoric decade.
The price of silver briefly hit its lowest ebb since September 2010, $20.25 (15.75 euros) per Troy ounce, on Monday before recovering some of its morning losses. Silver is currently trading at around $22 per ounce, $10 less than in January of this year and less than half of its 2011 high of $48.58.
After a frenzied rush towards precious metals over the past five years, with silver and gold’s prices doubling during the so-called financial crisis, investors have again started looking to company stocks and other market options.
The price of gold was also inching back down towards the $1,352 per Troy ounce low set on April 15 this year. Gold’s price more than trebled between 2006 and 2011, rising from less than $600 to a peak of more than $1,800 per ounce in half a decade.
Despite aggressive economic policies in key trading markets like the US, Japan and the EU, western economies are showing few signs of inflation. Precious metals and other such investments are typically considered a strong insurance policy against rising consumer prices.
A market strategist with the ETX Capital traders company, Ishaq Siddiqi, told the Reuters news agency that investors were selling off metals to compensate their losses on currency exchange markets after Japan’s yen jumped in value in the early hours of trading.
Blowing up the bubble
Germany’s DAX index closed at a record level of 8,455.83, the fifth consecutive record finish in Frankfurt, also logging another intraday high during trade on Monday. Across the Atlantic, the Dow Jones was set for another day in New York chasing record ticker tallies, with London’s FTSE also entering uncharted territory on Monday.
Japan’s Nikkei has similarly surged to 5-year highs in recent months since the election of Prime Minister Shinzo Abe, who has begun implementing a more “stimulus-driven” economic policy. Abe has ordered the Japanese central bank to print more money and introduced government money to spur business.
Carmakers were among the most buoyant in Frankfurt on Monday, with Volkswagen shares jumping 5.45 percent for the day, BMW climbing 2.09 percent and Daimler up 1.37 percent.