Silver prices are on a 6-month high at around $28.92. The market is reacting to the bullish manufacturing PMI figures from key economies like China, US, and the Eurozone. Besides, actions of the r/WallStreetBets community under the #silversqueeze movement have pushed the prices higher. Since last Thursday, the retail traders have been able to push silver prices up by close to 14%.
Bullish manufacturing PMI figures
On Monday, several economies released their manufacturing PMI figures for January. Notably, most of the readings are above 50; an aspect that has pushed silver prices higher.
Are you looking for fast-news, hot-tips and market analysis?
Sign-up for the Invezz newsletter, today.
China, which is the largest consumer of the precious metal, is one of the economies that have recorded a bullish manufacturing PMI. According to IHS Markit, the Middle Kingdom recorded a slow but significant expansion of its manufacturing activities. Its Caixin manufacturing PMI came in at 51.5. The reading missed the experts’ estimate of 52.7.
Notably, this is the second consecutive month that the country is experiencing slowed growth in its manufacturing sector. December’s figures were at 53.0, below the forecasted 54.8 and November’s 54.9. The reduced pace results from the rise in COVID-19 cases in the country and other parts of the world. the reduced export orders have further slowed factory activity in the Middle Kingdom.
Similarly, the eurozone has recorded an expansion of its manufacturing sector. With a reading of 54.8, its manufacturing PMI for January is a point higher from December’s. analysts had predicted that the figure will remain unchanged.
At the country level, Italy, France, and Germany’s numbers are bullish. The French and German manufacturing PMI readings have come in a point higher than predicted at 51.6 and 57.1 respectively. In the case of Italy, January’s figure of 55.1 has surpassed experts’ expectations of 52.4. The UK’s manufacturing industry has also shown a better-than-expected performance. Experts had forecasted an unchanged manufacturing PMI. However, January’s reading has come in higher at 54.1.
The US manufacturing PMI released by Markit has also come as good news for the bulls looking to buy silver. At 59.2, the reading is a point higher than the previous month’s figure. However, the number released by the Institute of Supply Management (ISM) has missed the estimates of 60.0. It is at 58.7, which still indicates an expansion of the country’s manufacturing economy.
The bullish data on the manufacturing activity in different economies comes at a time when silver has become the latest focus of retail traders in the r/WallStreetBets community. The campaign to short squeeze the precious metal started last week and is now trending on Twitter under ‘#silversqueeze’. Subsequently, bullion brokers based in the United States have recorded overwhelming demand for silver coins and bars. Most investors are holding on to the assets rather than taking profit.