Silver remained under pressure in September, falling more sharply than gold as higher long-term bond yields and a stronger US dollar weighed on the precious metal, according to OCBC.
With silver trading at around US$60 an ounce, OCBC said the metal’s steeper decline reflected its higher-beta characteristics, making it more sensitive to shifts in rates, currencies and broader risk sentiment.
The bank said elevated interest rates remain a key drag, while softer global risk appetite and an uneven China growth outlook have also constrained silver relative to gold.
Investor positioning has been less supportive as well. Unlike gold, which has continued to see accumulation through exchange-traded funds, silver ETF holdings have drifted lower, while managed-money positioning remains relatively light.
OCBC said the reduction in speculative positioning suggests some excess has been removed from the market, but there is still no clear evidence of renewed broad-based investment demand.
The lighter positioning, however, could allow silver to respond strongly if the macroeconomic backdrop becomes more favourable.
OCBC said softer US economic data that pushes Treasury yields and the dollar lower could trigger a larger rebound in silver than in gold. Conversely, a continuation of the current oil and interest-rate shock could leave silver more vulnerable to further declines.
Over a longer horizon, OCBC remains constructive but tactical on silver. A more convincing recovery would require not only a friendlier rates and US dollar environment but also renewed ETF inflows confirming that investment demand is broadening.
Technically, silver was last seen around US$60.60, with mild bearish momentum still intact despite the Relative Strength Index approaching oversold conditions.
OCBC sees support at US$55-US$56, while resistance is at US$64-US$66, followed by the US$70 level.
