As the shortage grows, promises to raise silver prices as demand for metal as a shelter for investors increases, writes Bloomberg.
In December, silver grew by 9.1%, the highest monthly increase in almost two years. The metal has used a trade war, a weakening of the dollar and a slower interest rate in the US.
On Wednesday, the metal price rose by almost 4 percent to $ 15.92 – the highest level since July 13
At the same time, it is expected that this year's demand for silver will exceed the harvest for the seventh consecutive year. Companies are avoiding new projects because of global economic uncertainty. According to a report from 11 analysts and traders, it could raise the metal price to $ 17.50 from $ 15.92.
The most expensive metal price rose to a new record
The value of palladium for several months is higher than the value of gold
However, we must also note that the same uncertainty destroys the forecasts of industrial use.
Robin Bar from Societe Generale SA estimates that this year, around 26,000 tonnes of silver will be harvested, the lowest amount since 2013.
Of course, there is a lack of profitability to raise prices in recent years. Silver is traded as a precious metal than industrial. The price has fallen by almost half since 2012 – the last time the market was half. In 2018, for which Societe Generale estimates it was the sixth row with a lack of harvest, prices fell by 8.5 percent.
The US Federal Reserve plays an important role. Over the past three months, when investors began to expect a slowdown in interest rates, gold and silver were one of the best assets.
But recently, the central bank has indicated that it will closely monitor the latest data to determine its future policy. If the Fed decides to slow down growth, it will support the metal price.
Gold is also on the rise, the rally has been growing 13.05% since August.
* The material is analytical and is not a recommendation for the purchase or sale of precious metals