If you check the silver price in Singapore several times throughout the day, you’ll notice one thing quickly: it rarely stays still.
Silver trades globally, and its price responds continuously to changes in currencies, interest rates, industrial demand, investor sentiment and physical supply.
So who actually sets the silver price? And why can the price of a silver bar in Singapore change even when the bar itself has obviously not changed? Let’s explore that in this article.
How Is the Silver Price Set?
International silver is primarily priced in US dollars per troy ounce, with global markets providing continuously changing prices as silver is traded around the world.
One of the industry’s major reference prices is the LBMA Silver Price, an internationally recognised benchmark for silver delivered in London.
The benchmark is established through an independently administered electronic auction held once each London business day.
But the silver market doesn’t stop trading once that benchmark has been established.
Silver continues to trade across global markets, which means the live or spot silver price can move throughout the day as buyers and sellers react to changing market conditions.
That is why the silver price today should be viewed as a live market rather than a fixed daily retail price.
Why Does the Silver Price Change Throughout the Day?
Silver trades internationally, and its price responds continuously to changing expectations about supply, demand, currencies, interest rates and the global economy.
Several factors can cause silver prices to move.
1. The US Dollar
Because international silver prices are primarily quoted in US dollars, changes in the dollar can influence the metal’s price.
A strengthening or weakening US dollar can therefore have an impact on silver even before a Singapore investor considers the SGD conversion.
2. Interest Rates and Monetary Policy
Expectations surrounding interest rates can affect demand for precious metals.
Changes in US Federal Reserve policy, inflation expectations and government bond yields can all influence investor positioning in silver and gold.
3. Industrial Demand
Silver isn’t only a monetary or investment metal.
It is also used extensively in industry, including electronics, solar technologies and other applications requiring its high electrical and thermal conductivity.
This gives silver an unusual dual role: both investment asset and industrial commodity.
Changes in expectations for industrial demand can therefore affect its price.
4. Investment Demand
Demand for silver bars, coins and financial silver products can rise during periods of heightened economic or financial uncertainty.
When investor demand changes quickly, silver can experience significant price movements.
5. Global Supply
Mine production, recycling and the availability of refined silver all contribute to the supply side of the market.
Silver supply cannot always respond immediately to changes in demand, which can contribute to periods of greater price volatility.
Why Does a Silver Bar Cost More Than the Spot Price?
This is one of the most common questions new bullion buyers ask.
The spot silver price represents the underlying wholesale value of the metal. A physical investment product has additional costs associated with turning that metal into something an investor can actually purchase.
These can include:
- refining and manufacturing
- minting or casting
- transportation and insurance
- wholesale and retail distribution
- product availability
- brand and product-specific premiums
Different products can therefore contain the same amount of silver while carrying different premiums.
A smaller silver bar will also typically have a higher premium per gram than a much larger bar because manufacturing and handling costs are spread across less metal.
For investors focused primarily on accumulating silver weight, comparing the premium above spot across different sizes can be just as important as comparing the headline price.
Physical market conditions can also influence premiums. We explored this recently in Shanghai Silver Pricing US$8 Premium Over COMEX: Why Is the Price Arbitrage Not Closing?.
Silver Price Per Gram or Per Ounce?
International markets typically quote silver per troy ounce, with one troy ounce equal to approximately 31.1035 grams.
If you’re comparing physical silver products, however, don’t look at weight alone.
Consider the price per gram or ounce, purity, product premium and buyback price. This provides a clearer picture of what you’re actually paying.
Is Silver Subject to GST in Singapore?
Not all physical silver is treated equally for GST purposes.
Singapore exempts qualifying Investment Precious Metals (IPM) from GST.
For a silver bar, ingot or wafer to qualify, it must meet specific requirements, including a minimum purity of 99.9% silver, alongside other qualifying criteria.
Qualifying investment-grade silver coins can also receive IPM treatment, while jewellery, certain collectible products and products that fail the qualifying criteria may not.
This distinction is important when comparing silver products because investors should confirm whether the bullion they are purchasing qualifies as IPM under Singapore’s rules.
What Should You Look at Before Buying Silver?
The headline silver price today is only the beginning.
Before purchasing physical silver, consider:
- the underlying spot price
- the SGD/USD exchange rate
- the premium above spot
- weight and purity
- whether the product qualifies for Singapore’s IPM GST exemption
- the dealer’s buyback pricing
For larger purchases, comparing the silver price per gram or ounce can be particularly useful because it allows different products and bar sizes to be assessed on a more consistent basis.
Understanding the Bigger Silver Picture
The silver price in Singapore ultimately reflects a combination of the international silver market, foreign exchange rates and conditions within the physical bullion market.
Understanding these factors can help investors look beyond the headline price and better compare the actual cost of different silver products.
For a broader look at silver’s longer-term valuation, read our analysis Silver’s Extreme Undervaluation: Today’s Price Opportunity Should Not Be Ignored.
At Indigo Precious Metals, investors can monitor live silver prices and compare a range of physical silver bars and coins across different weights.
View the latest silver price in Singapore and explore our range of physical silver bullion.
This article is provided for general information only and does not constitute financial or investment advice. Precious metals prices can rise or fall, and investors should consider their own circumstances before making an investment decision.