On June 5, Sprott Physical Silver Trust fell 5.14% in regular trading, trading at $21.89/share, with trading volume of $129 million. The decline came as spot silver plunged over 4% to $70.82/oz following a stronger-than-expected U.S. May non-farm payrolls report.
The robust jobs data sharply shifted market expectations toward further Federal Reserve monetary tightening. Interest rate futures now price in a 63% probability of a December rate hike, up from 48% prior to the release. The U.S. dollar index surged to 99.741, a two-month high. Analyst Anstey noted the data would completely eliminate any rationale for Fed rate cuts in the coming months. In a higher interest rate environment, holding costs for non-yielding assets such as silver rise significantly, prompting institutional investors to accelerate liquidations. The oil-price-to-inflation-to-rate-hike transmission chain further pressured silver prices, dragging PSLV lower in tandem.
Sprott Physical Silver Trust is an exchange-traded commodity fund managed by Sprott Asset Management, LP. The fund invests primarily in physical silver bullion in London Good Delivery bar form and was formed on June 30, 2010, domiciled in Canada.
(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)
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