The easing of economic concerns in global markets continues to affect the demand for precious metals as a safe haven, but one research firm suggests that this shift in sentiment could provide new momentum for silver.

Despite gold prices experiencing an unprecedented surge this year, reaching a historic high of $3.500 per ounce last week, silver has lagged significantly. Currently, the gold-to-silver ratio remains high at around 100 points.

Analysts point out that gold has significantly outperformed silver as investors attempt to navigate President Trump's unpredictable trade policies and hedge against economic disarray and geopolitical uncertainties. Meanwhile, more than half of the global demand for silver comes from industrial consumption, which has slowed due to the uncertainties surrounding global trade.

Matt Bauer, a commodity strategist at Ned Davis Research, says that while silver has struggled to hold above $33 per ounce, it is severely oversold relative to gold and moderately oversold on an intermediate time frame.

Bauer notes that silver sentiment fell to its lowest level in over a decade earlier this month, according to the NDR confidence indicators.

He says, "Since then, sentiment has started to rebound, although it has not yet crossed the neutral hurdle. Reverting to neutral would open the door for further progress. While silver sentiment is subdued, gold sentiment can't get much higher, creating a gap between the two indicators that has only rarely become wider."

Although President Trump's global trade wars have dampened economic activity, Bauer suggests that peaking uncertainty could be a good omen for silver.

He says, "The arbitrary introduction and punitive nature of U.S. tariffs have pushed the 12-month point change in the Global Economic Policy Uncertainty index to its highest level ever, even surpassing the increase during the pandemic. However, given silver's dual nature as a precious and industrial metal, a return to normalized policies could increase confidence in economic growth, potentially benefiting silver more."

Meanwhile, Bauer says that anticipated interest rate cuts could also support silver prices over the remainder of the year. With uncertainty weighing on economic growth, markets currently expect the Federal Reserve to cut rates four times this year, and expectations for a June cut are rising.

He adds, "Silver has been negatively correlated with the U.S. dollar for most of this century. An expansion in the money supply, which puts pressure on the dollar, should boost precious metals, and a return to expansionary policies would support the upward trend in precious metals."