Silver prices continued to slump this week, falling to an 11-month low, as a dash for cash and the US dollar drove down asset prices across the board.
 
Even a successful bond auction by Italy, which saw short-term yields halve, was not enough to lift sentiment on Wednesday, the first day of the week in which Europe, the US and London were all open. Periodic liquidations of precious metal holdings have been the norm for much of 2011, as money managers look to preserve cash in case the eurozone debt crisis takes yet another turn for the worse. Of course, we are seeing these losses taking place in low-volume conditions, with trading desks sparsely populated in this period between Christmas and the new year.
 
Figures from the ECB provided reason for concern, as the bank reported unprecedented use of its deposit facility by worried banks. So long as the eurozone crisis continues to affect sentiment, then traders will remain nervous about holding their funds in anything other than cash for the time being. We can only hope that 2012 sees a more concerted effort to produce a solution than 2011 did.