Fresnillo PLC (LSE:FRES) was among the FTSE 100’s top risers in morning trading as silver surged to a record high, lifted by expectations of a US interest rate cut and strong industrial demand for the metal.
Spot silver crossed $60 an ounce for the first time on Tuesday, extending a rally that has already more than doubled its price this year.
In early trading on Wednesday, the metal built on recent gains to nudge just above $61. Gold, by contrast, was moribund at $4,197.
Silver's move reflects a broad shift into precious metals as investors position for the Federal Reserve’s widely expected quarter-point rate cut.
Lower interest rates tend to weaken the dollar and reduce the appeal of holding cash or short-term bonds, pushing traders towards assets viewed as stores of value.
Analysts say silver is also benefiting from a “spillover effect” as buyers seek a cheaper alternative to gold.
Yet the rally is not purely financial. Demand from manufacturers has outpaced supply, underpinned by silver’s role in electric vehicles, solar panels and next-generation batteries.
Production is slow to scale, as most silver is mined as a by-product of other metals. Concerns over potential US tariffs have added to stockpiling and tightened global availability, a backdrop that analysts expect to keep prices elevated.
In late morning trading, Mexico-focused silver digger Fresnillo was up 2%, while Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF), mainly a gold extractor, advanced 1.5%.
Stepping down to the FTSE 250, Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF) was a notable mover as it advanced 3.3%.