Silver Market 2024: Analysis of Trends and Predictions

Silver is in a special situation at the start of 2024. On the one hand, industrial demand for this precious metal continues to grow, particularly from the solar energy and electrification sectors, while supply remains limited. On the other hand, overall demand fell by 10% in 2023 and the Silver price around €21.50 per ounce.

Investing in silver

Investors in silver are wondering how these two situations can be true at the same time and what is needed for the price of the gray metal to rise. According to Peter Krauth, editor of SilverStockInvestor, the situation is complex, but the outlook for 2024 and beyond remains very favorable.

The biggest drivers behind the decline in demand this year are the jewelry, silverware, and physical investment sectors. Krauth notes that these sectors experienced unprecedented demand in 2022 and that a correction is not surprising.

Offer can't track

Krauth emphasizes that the lack reflects the actual net position of the market. Mine production and recycling are not expected to be able to meet next year's demand. Projections show a 42% growth in aggregate demand by 2033. Even the demand for jewelry and silverware, which fell sharply in 2023, is expected to increase by 34% and 30%, respectively, over the next decade.

The influence of economic factors

Krauth expects that despite slowing global growth in the first half of 2024, there will be some recovery in demand for jewelry and silverware in Asia. He also sees a surprising recovery from the investment community in 2024. Analysts at TD Securities and JPMorgan predict a significant valuation of silver prices in 2024, supported by growing demand in the solar sector and increasing investor interest.

De-dollarization: a new driver

Krauth also mentions the possibility that governments' growing monetary reserves and strategic reserves to support industry could be a new powerful driver for silver prices. He emphasizes that recent forecasts from banks and the Silver Institute do not take into account the latest projections from the Federal Reserve, which could have a significant impact on the silver market.

A promising future for silver

While a significant economic slowdown or recession is likely to boost investment demand, industrial demand, which is silver's strongest growth sector, is also expected to be positively impacted. The silver market in 2024 promises to be complex but promising, with various factors working together to influence the price and demand for silver.

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On behalf of Holland Gold, Paul Buitink and Joris Beemsterboer interview various economists and experts in the field of macroeconomics. The aim of the podcast is to provide the viewer with a better picture and guidance in an increasingly rapidly changing macroeconomic and monetary landscape. Click here  to subscribe.  

Author: Ernest Hoffman