Financial encyclopedia

The spot price of silver once surpassed the 90-dollar mark, reaching a new high. This once again drew the attention of the market to a question: Who actually determines the price of silver? 
1. The current price of silver has risen. What does this indicate? 
The current increase in the price of silver is the result of multiple factors coming together.
Due to the relatively small scale and thin liquidity of the silver market, when demand and funds simultaneously pour in, the price reaction is often more rapid than that of gold. Therefore, "rising quickly" is already part of its market structure. 

II. How to interpret the situation where the price of silver has risen significantly? 
The price of silver is not solely determined by risk aversion or inflation.
It has two identities: it is both a precious metal and an important industrial raw material. 

III. Industrial Applications of the Entity 
Silver is widely used in electronic product conductive components, semiconductor and chip packaging, solar panels, new energy equipment, as well as electric vehicles and data centers. 
The competition in artificial intelligence, semiconductor technology, and the trend towards electrification have indeed increased the medium- and long-term demand for silver. However, industrial demand is realized gradually. The market reflects expectations in advance rather than responding to immediate demands. 

IV. The Impact of Market Sentiment and Speculative Funds on Amplification Effects 
The short-term sharp rise in silver prices is often closely related to market sentiment.
When speculative funds or ETFs flow in, the driving force for silver prices is often greater than that for gold, which also explains the more intense fluctuation pattern of silver prices. 

V. China's Export Restrictions and Supply-side Factors 
China has included silver in its export licensing management system and elevated it to the level of strategic materials, restricting the supply flow to entities. Market concerns over a tightening supply have driven up the spot premium, becoming one of the significant driving forces behind the rise in silver prices. 

Six. Why is silver more prone to a significant price surge compared to gold? 

1. The market size is relatively small, and the inflow of funds has a greater impact on the price;
2. The supply mainly comes from by-products of other metals, and the output is difficult to increase rapidly;
3. At the same time, influenced by industrial expectations and market sentiment, the situation is rather complex.

Understanding silver,
The key is not to predict the next rise or fall,
But to clearly see
Which force is currently dominating the price.