Silver prices are above $US16.41 ($A23.24) per ounce — and analysts are pointing to a rosy gold ratio as evidence it has further to run.
It hit the mark during last night’s trade on the COMEX exchange — largely on the back of geopolitical concerns stemming from Iran’s seizure of a British tanker.
According to the data gathered by Dow Jones, it finished higher than at any point since June 22 in 2018 on the back of a 1.3 percent rise.
“The wind is now at our backs and we believe that both gold and silver will climb higher,” Maria Smirnova, senior portfolio manager at Sprott Asset Management, wrote in a recent report cited by the newswire.
Smirnova cited the gold-to-silver ratio of 93:1 — meaning it takes 93 ounces of silver to buy one ounce of gold — as evidence that it could have further to run.
“This leaves significant room for [it] to run. The annual silver market is only about $15 billion of value, and it does not take much to move silver’s price,” Smirnova said.
“Silver demand is already making a stealth comeback with the US mint reporting a 43 per cent increase in silver coin sales year-to-date as of June 30 and with ETFs gathering steam. If this investor interest continues, it will definitely push the price higher.”
While it’s has been in somewhat of a slumber for most of the year, certainly compared to gold’s tear, there have been signs that silver could start rebounding sooner rather than later.
Earlier this month Hecht Commodity Report creator Andrew Hecht predicted the breakout price would be $16.20 an ounce.
“Gold is telling us that there is inflation and [it’s] making a statement on the weak currencies around the world,” Hecht said.
“Gold back above $1,400 is telling us that silver is not going back below $15, so I would be a buyer here.”
This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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