Silver prices have been fluctuating and briefly hit their lowest point of the year, driving up demand for silver investment in Shuiwei, Shenzhen.
Reporters recently visited several silver merchants in Shuiwei and learned that the benchmark silver price has fallen to as low as 11 yuan per gram, the lowest level this year. Sales of investment products such as silver bars and silver ingots have clearly picked up, and cases of customers purchasing dozens of kilograms in a single order have begun to appear.
Multiple merchants said recent sales have increased noticeably compared with the slow season from June to August. One merchant said their daily sales have risen from more than 20 kilograms to more than 50 kilograms. Another merchant said retail customers usually account for about 20% to 30%, but that share has now risen to 50% to 60%, with some customers regularly buying a batch every week since last month.
At the same time, however, merchants generally agree that current daily sales still fall short of the levels seen at the high point of silver prices earlier this year.
Many buyers are thinking of stocking up while prices are low. Merchants have observed that silver prices have fluctuated downward for months from their highs, and buyers generally believe there is limited room for further declines. Once prices rebound, they expect considerable upside, and they hope silver can return to last year's highs in one to two years.
One merchant said he is also adding to his position, with inventory now exceeding 250 kilograms, more than 100 kilograms higher than at last year's peak.
Regarding this round of rebound, Xu Chuanbao, chief investment adviser at Jinyuan Securities, analyzed that it is more of a technical oversold rebound, mainly following the recovery in gold prices. He believes gold is supported by long-term value-preservation demand such as central bank reserve purchases, while silver's attributes in this regard are relatively weaker, so the sustainability of the rebound remains to be seen. If overseas inflation does not ease, silver prices may still have room for adjustment in the long term. He added that silver's previous surge to 30 yuan per gram benefited from a low-interest-rate environment, and it would be relatively difficult for it to rise to such a high level again when liquidity is poor.
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