Silver is starting a new trading week just above $23 an ounce as a slight weakening in the US dollar has enabled the metal to recover a fraction of the ground it has lost so far in September.
In contrast to its precious metal peer, gold, the medium-term prospects for silver look promising as the likelihood of a recession, particularly in the US, continues to fade with each economic data point defying investor pessimism.
While silver does have safe haven appeal, the industrial element to its demand profile means that a healthy US economy is going to have a more significant bearing on the metal’s long-term prospects. With silver’s excellent conductivity making it a key component of the energy transition that will require a huge increase in electricity, the metal’s current supply deficit looks set to continue for many years yet.
So while silver may be languishing near $23 an ounce currently, the price looks way below its fair value given its fundamental outlook that should see it trading nearer $30 an ounce.
Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience in writing about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News.
As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewable energy and the challenges of avoiding greenwash while investing sustainably.
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