Silver prices rose 0.5 per cent to Rs 56,423 per kg at the futures market today, mostly on the back of covering-up of short positions by speculators, even as the metal dropped to a three-week low in overseas markets.

At the Multi Commodity Exchange, silver for delivery in March rose Rs 280 or 0.5 per cent to Rs 56,423 per kg with a business turnover of 6,245 lots. Similarly, the metal for delivery in May moved up by Rs 279 or 0.49 per cent to Rs 57,654 per kg with a trade volume of 221 lots.

Market analysts said the recovery in silver prices at the futures trade was mostly attributed to covering-up of short positions at prevailing levels by speculators but weakness in white metal overseas limited the gains.

Meanwhile, silver traded lower by 1.3 per cent to $30.91 an ounce, the lowest level since November 21, in the Asian region as Europe’s debt crisis boosted the demand for the dollar as a haven, reducing the appeal for precious metals.

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