Silver is back below $24 an ounce but its solid recovery remains on course with the recent price action likely to be the latest consolidation before another fresh move higher.
In contrast to its precious metal peer gold, silver enters the festive season full of optimism with plenty to look forward to in the new year.
While the prospect of the Federal Reserve remaining aggressively hawkish for a while longer remains the main headwind for the metal, the strength of physical demand should more than offset that. This is demonstrated by silver’s gains from the middle of October onwards, which have been achieved in the face of continued interest rate hikes by the Fed and other central banks across the world.
Barring something dramatic affecting the markets between now and the end of the year, silver looks set to achieve a small annual gain – something that seemed fanciful when the price was enduring its multi-month slump from April through to September.
Yet despite silver’s impressive rally since that September nadir, its price remains some way off the March high for the year showing there is still plenty of upside potential given the overwhelmingly strong fundamental case for silver, with it in demand from multiple sectors across the world.
Therefore, with the March high the major initial target for early 2023, there is potential for silver’s rally to keep on going and see it challenge $30 an ounce – the kind of levels not seen for over 9 years.
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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