As the eurozone debt crisis deteriorated this week and fears of Greek debt contagion increased, demand for silver rose.
 
The disagreements between US lawmakers trying to reach a consensus on raising the US debt ceiling also attributed to the rise in the precious metal this week. Yesterday, in a testimony to the US Congress, Federal Reserve Chairman Ben Bernanke said that a failure by Congress to raise the $14.3 trillion debt ceiling would lead to a major crisis and throw shock waves through the financial system. He also announced that another round of quantitative easing was a possibility if the US economy continued to flounder. The possibility of QE3 led Moody’s to announce that it had placed the US credit rating on review for a downgrade. This saw silver surge over 6% yesterday, the most since March 2009, and rise to its highest level since April.
 
With markets becoming less confident in the US dollar, the currency saw a decline of more than 1% against a six-currency basket, allowing commodity prices to surge and saw investors flock back into safe-haven precious metals.
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