Silver speculators continued to add to their shorts on net last week. Diwali holidays in India are set to add further pressure on the white metal, economists at TD Securities report.

Silver prices succumb to the weight of rising real rates

“Before it binds the Fed, quantitative tightening is increasingly constraining other central banks, supporting the broad dollar while weighing on precious metals, leading silver prices to succumb to the weight of rising real rates.” 

“Inflation's rising persistence suggests the Fed is unlikely to stop hiking preemptively, which points to a prolonged period of restrictive rates that should continue to sap interest from institutional investors. However, massive purchases of physical precious metals from retail buyers are clashing with institutional investor outflows in past months, keeping a floor on prices.” 

“With Diwali celebrations kicking off in a few days, silver could lose a dominant pillar of support.”