Securities silver holdings rise to record

LONDON, May 12 (Reuters) - ETF Securities said on Tuesday the amount of metal it holds to back its silver exchange-traded commodity rose more than 3.9 percent to a new all-time high on May 11.

The company's Physical Silver ETC (PHAU.L) added more than 700,000 ounces ounces to its holdings on Monday, which now stand at a record 18.702 million ounces.

ETF Securities head of research Nicholas Brooks said the metal benefited not only from higher gold prices but rising interest in silver as an industrial precious metal, as hopes grow that the economic downturn may be bottoming out.

"People are looking at silver as a precious metal, but also a play on the cyclical upturn," he said. "It is really getting a substantial boost, and we are starting to see that in our ETC inflows."

Exchange-traded funds, which issue securities backed by physical stocks of a particular metal, have represented a major source of demand for precious metals in recent years.

(Reporting by Jan Harvey; Editing by William Hardy)