By Melissa Pistilli – Exclusive to SilverInvestingNews.com
It’s been a pretty slow and uneventful last few days, typical for this time of year in the resource sector. Activity on the precious metals front has been relatively quiet. Silver experienced a very modest rise to close at $17.49/oz on Monday over concerns of a chance rebound in oil and a possible dollar tumble.
The dollar did fall slightly against the euro yesterday after reports that the U.S. budget deficit is likely to hit a record mark this year. Precious metals prices were also bolstered up by a rise in oil prices above $124 per barrel on news of another militant attack on Nigerian oil pipelines and hints from President Ahmadinejad that Iran has sharply increased the size of its nuclear program.
By this morning, however, a dip in oil prices to $121.65 and a higher dollar caused many precious metal traders to sell and silver fell to $17.10/oz. The dollar made gains against the euro as investors become increasingly concerned that more European Central Bank interest rate hikes could further damage an already hurt European economy. Oil also slipped on weakening demand, which outweighed the threat to supply brought on by events in Nigeria and Iran.
It seems silver may have to struggle to make gains at least until significant moves in the dollar or oil can lend support. U.S. data reports due out later this week might prove beneficial. Tomorrow, the U.S. Department of Energy will release oil inventory data. Gross Domestic Product numbers and initial jobless claims will be reported Thursday and non-farm payrolls, construction spending and auto sales data will come out on Friday.
Silver Junior Highlight
U.S. Silver Corporation [TSX.V: USA] announced yesterday its June silver production was 161,000 ounces. The highest monthly production since U.S. Silver acquired the Galena Mine Complex in June 2006. The Galena Mine rests in Shosone County, Idaho and is the second most fruitful silver producing mine in U.S. history. The output figure for June is 37% higher than 2008 first quarter average monthly production figures and 61% higher than in 2007. These latest results give an annualized rate of approximately 1.93 million ounces.
The company reports that in June the Galena Mine increased 260% compared with 2007 and 198% compared to the first quarter of 2008 with an average of 879 tons per day. By the end of this year, the company’s management anticipates monthly production levels will increase to over 250,000 ounces as new production from the 5200 level silver-lead zone begins in the fourth quarter.
