Analysts of Bank of America Sees $35 Silver Price as the New Normal for the Next Two Years

Silver Price Confirms Its New Floor at $30
Published on: Jun 17, 2024
Author: Caroline Kong

Michael Widmer, precious metals strategist at Bank of America, said that despite the recent sell-off in silver, which has seen the price fall below $30 an ounce, the silver mining industry has strong growth potential and is bullish on silver prices rising to $35 an ounce over the next two years.

July silver futures contract last traded at $29.235 an ounce, down 0.86 per cent on the day.

Many market analysts have recently said that even in the current correction, silver has managed to secure solid support at the uptrend’s 50-day moving average, a very strong signal that the fundamentals of the silver market are getting stronger.

Silver has under-performed gold due to weak industrial demand, according to Lawson Winder, a research analyst at Bank of America and author of the latest silver report. As the global economy turns the corner, silver’s performance should begin to improve. Other positive factors are emerging as next-generation solar panels, which require more silver, become more popular.

All of these are likely to attract more investors to the market, creating a virtuous cycle that will push prices higher, and the era of $30 per ounce silver prices is upon us.

Widmer also pointed out that silver has great potential as an industrial metal, but investment demand will have to pick up if silver prices are to really take off. He added that while silver prices have been able to maintain stability recently, they have not risen decisively, and one of the reasons for this is low investor demand. There is a lack of investor interest in assets managed by physically backed ETFs.

In addition, the net non-commercial position on the Chicago Mercantile Exchange, trading volumes on the Shanghai Gold Exchange/Shanghai Futures Exchange, and silver coin purchases in the U.S. have not seen a significant recovery. Bank of America analysts wrote at the end of the report that it is reassuring to see encouraging signs of commercial demand for silver, which may ultimately attract investors and thus solidify Bank of America’s constructive view of silver’s trend in 2024.

Last month, Craig Hemke, a precious metals expert and founder of TF Metals Report, said that $30 may have become a new bottom for silver. He said that silver is catching up and has the potential to outperform the broader market. Looking ahead, he believes a long-term price target of $50 is still within reach.


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