A leading independent precious metals research consultancy expects silver to benefit from the rising price of gold early next year. The consultancy firm, Metals Focus, reported this in its recently released 2021/2022 annual report, which focuses on investment in silver, gold, palladium and platinum.
Director of Silver and Gold at Metals Focus, Neil Meader, stated that the innate high volatility of silver meant that the metal could probably outperform gold during early 2022. However, the consultancy added that the metal’s prices would probably drop after this, especially when the Federal Reserve gives a more clear guidance on the timing of the first post-coronavirus interest rate increase. The firm believes that the favorable fundamentals of silver may, despite this, provide some price support in 2022.
It noted that between palladium, silver, platinum and gold, silver was the only precious metal that was most likely to attain a persistent deficit in the 2021–2022 period. Metals Focus explained that this would mark the end of the consecutive surpluses recorded between 2014 and 2020, adding that this change was caused, in part, by strong industrial fabrication.
The firm also mentioned that on top of recovering from the damage caused by the coronavirus pandemic, there were structural forces at work, including the commitment of governments to investing in green infrastructure, 5G technology proliferation and the electrification of vehicles.
In addition to this, the company added that post-pandemic recovery in the demand for silverware and Indian jewelry as well as healthy bargain hunting on dips in price by retail investors would offer useful support.
In its report, Metals Focus explained that partial restocking and the opening up of the broader economy would facilitate gains in consumption, even with higher prices of silver, noting that however, if expenditure shifted back to travel, gains would be more apparent in the first half of 2022. The firm also expects the price of silver to mirror that of gold next year, increasing by 2% to reach about $25.70, before it softens in the second half of the year. The metal’s price has been a bit unstable, given the sharp decline recorded at the end of September, which saw the metal reach the $21 range for the first time since July last year.
Currently, silver is trading at $22, which is quite a drop from its peak of about $30, recorded earlier this year. However, this is still high in comparison to its $16/$17 price of 2015–2019, which gives investors hope for the future.
The future looks bright for precious metals companies such as Asia Broadband Inc. (OTC: AABB), which have a firm foot in the market for silver and other precious metals.
NOTE TO INVESTORS: The latest news and updates relating to Asia Broadband Inc. (OTC: AABB) are available in the company’s newsroom at https://ibn.fm/AABB
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