Commerzbank: gold-silver price ratio hits lowest level since mid-March

Berlin-Germany (May 20)  The sharp rise in silver prices lately enabled the gold-silver ratio to dip below 100 for the first time in two months, said Commerzbank. The ratio measures how many ounces of silver it takes to buy an ounce of gold. A smaller number means silver is outperforming, which is exactly what has been happening lately. Silver earlier Wednesday hit its highest level since the end of February, Commerzbank pointed out.

At the time, the price had surged by almost 14% week-on-week. “The steep rise in the silver price has driven the gold-silver ratio below 100 again for the first time since mid-March, when the severe turmoil on the financial markets saw it increase to a record level of 127,” said analyst Carsten Fritsch. “In other words, one ounce of gold was worth 127 ounces of silver, as compared with just under 100 ounces now. This still means that silver is good value, however, as the long-term average for the gold/silver ratio is somewhat above 60. Even during the 2008 financial crisis it only reached 85.”

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