The Wall Street Journal: Gold Shine Spreads to Other Precious Metals

Article by Jon Sindreu in The Wall Street Journal

Gold has recovered some of its former shine lately. Silver and platinum have been dull by comparison, but if history is any guide they are likely to regain their luster too.

The price of silver has surged by 8.3% over the past two weeks. This may be a sign that gold’s impressive rally over the past year—its price has gone up 16%, compared with roughly 6% for the S&P 500—is finally spreading to other precious metals.

Part of the yellow metal’s jump is explained by extraordinary demand for haven assets. Investors have been fretting about the risk of a global economic slowdown as well as an escalation in the U.S.-China trade spat.

But much of it also has to do with the Federal Reserve’s policy. And that should eventually boost all precious metals.

Ultimately, however, one-year moves in both metals have historically been highly correlated with those in gold. In the case of silver in particular, the link appears too strong to be ignored for long.

To read this article in Wall Street Journal in its entirety, click here.