Spot silver rose as much as 1.9%, exceeding $39 an ounce, following last week’s 4% rally. The implied annualized cost of borrowing the metal for one month has jumped to more than 6%, compared with its typical rate of near zero.

The rise in appetite for the metal has left the physical market under strain in London, where most silver is held by exchange-traded funds — meaning it isn’t available to lend or buy. Since February, the volume of silver-backed ETFs has expanded by some 2,570 tons, according data compiled by Bloomberg.

Silver’s outperformance of gold means that the ratio between the two has dropped in recent months, though silver still remains relatively cheap historically. It currently takes about 86 ounces of silver to buy 1 ounce of gold, compared with a 10-year average of 80.

“Silver demand is currently benefiting from the threat of trade wars and bullion being way out of reach for many,” said Priyanka Sachdeva, an analyst at Phillip Nova Pte Ltd. “Gold has already seen a tremendous upswing, and it’s currently expensive,” leaving investors more inclined to consider a cheaper alternative, she added.

Concerns over US trade policy have also helped to push the metal higher. Mexico, the largest producer of silver and a key supplier to the American market, has been hit with a 30% tariff threat. The terms of the US-Mexico-Canada Agreement exclude silver from the latest levies, but some traders expressed concerns about the possibility that exemptions could yet be threatened.

Meanwhile, the spread between London spot and September futures contracts in New York has been unusually wide, similar to the start of the year when worries about President Donald Trump’s aggressive trade policies triggered a surge of gold and silver shipments from London to the US, driving prices higher.

The metal is up 35% this year, surpassing gold’s 28% gain. As well as being a haven asset, silver also has industrial uses, most notably in solar panels. The market is headed for a fifth year in deficit, according to industry group The Silver Institute.

Silver was up 1.7% at $39.08 an ounce as of 11:41 a.m. in London.

Meanwhile, gold added 0.5% to $3,371.05 an ounce, following a 0.6% increase last week. It’s been supported this year by haven buying due to increased geopolitical conflicts and trade tensions, along with central-bank purchases.