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Silver Prices Forecast

Although silver is far cheaper than gold, the buying and selling of the precious metal can still be profitable. As with any asset, selling at a higher price than you paid is the aim. For silver this is best achieved by making a long-term investment in the metal, but with recent gains profits can be realised quickly, and using a silver prices forecast can be a useful tool in spotting buying and selling opportunities.

Silver can increase or decrease in price suddenly and significantly, but over time it has trended upwards. By keeping silver for years, the general trend suggests that you would likely see an increase in value.

Silver Price Predictions

Forecasting the price of any commodity – silver included – is always a question of informed opinion, rather than absolutes. Silver price predictions are notoriously difficult, due to the number of factors that can impact it. Prices can rise and fall unexpectedly, and shocks to demand – or surprise political and economic announcements – can soon render any forecast outdated and invalid.

By analysing market trends and historical patterns though, it is possible to make an informed opinion as to what could happen in the near future.

For those interested in gold, we also have our current gold price forecast. Read on for our current silver price predictions.

Silver Price 2024

2023 was a mixed year for silver, with some large swings in prices. March 2023 saw a low of $20.09 before reaching a peak of $26.02 just a few weeks later in April. The average value was around $23 - $24 however, and still leaves silver a long way from its all-time high despite gold reaching new records last year.

One of the key drivers for the silver price in 2024 will be the strength of the dollar. 2023 already saw some dollar weakness as markets have decided that US interest rates have now peaked. This is likely to continue or accelerate even in 2024, with rate cuts likely, particularly in the second half of the year. Lower interest rates should see the dollar weaken further and will help support the 2024 silver price.

Mining output in 2023 saw a 2% increase on 2022, but this still amounted to a deficit overall, with 1,024.9 million ounces produced, but demand reaching 1,167 million ounces according to the silver institute. Mining costs are only increasing, and while investment demand saw a drop in 2023 (-7%), industrial demand continues to climb.

Silver use in solar photovoltaics in particular increased by 15%, and green technology continues to represent one of the biggest demand opportunities for silver. Many countries are legislating for the transition away from fossil fuels, and this is only going to push up the industrial demand for silver. Unless mining production increases significantly in the coming years, the supply deficit will only continue to grow, driving the silver price higher.

Geopolitical factors could also drive some further safe haven demand in 2024, although the increasingly volatile state around the world in recent years appears to be resulting in less impact from events like Ukraine or Gaza. Escalation in the Middle East or any new conflicts appearing could still have an effect on the silver price. The election in the US could also seem some dollar volatility in either direction.

2024 silver price predictions are a mixed bag, though many do agree that the second half of the year has the greatest potential for gains, when the Federal Reserve begin to cut US rates. A solid move above the 2023 peak of $26 will be the key trigger for any significant rises, and $30 remains a key target for now. Some forecasts do suggest higher, while a minority believe silver will continue to trade in the $24 - $26 range.

Silver Price 2023

2022 ended very strongly for silver, climbing from a low of $17.77 to end the year at $23.97. Industrial demand hit a record high in 2022 and looks even stronger this year as China reduced their Covid restrictions, which should help improve output and limit the disruptions that plagued Chinese factories during the pandemic.

The US dollar also weakened as inflation figures suggested it may have peaked. Despite inflation remaining high interest rate expectations for the US have come down, which has pushed the dollar off its recent highs. The strength of the dollar is a key driver for the gold price in 2023, and will also have a similarly important influence on the silver price.

Silver will also be supported by the ongoing rising demand from cleaner, electric energy sources and technologies likes cars. Governments continue to work towards ‘green’ energy policies and targets that will help push up the need for silver beyond the already high demand.

The general consensus among analysts is that silver could hit $30 per ounce this year, and from there could jump higher quite quickly, as has happened in the past. Some forecasts suggest a range of $30 - $50 per ounce as a result. A recession could halt this however, particularly if it’s severe or stock markets crash, which could reduce industrial demand significantly. All in all though, most forecasts do suggest the silver price could rise in 2023.

Silver Price 2022

Consensus from experts on the silver price in 2022 are few and far between. The ongoing economic fallout of the global pandemic have kept silver higher than recent years, but the alternative metal has failed to reach new records. Many industrial metals have seen soaring prices as inflation bites, but so far silver hasn't achieved these same gains.

Many analysts believe silver is overdue a bull run, but are unsure whether 2022 is the year that the silver price will rise significantly. Investment demand remains high, but industrial demand is still being held back by shortages of other materials. The semiconductor shortage plaguing many electronics producers, will also be keeping silver demand down.

Further advancements in green technologies and electronic vehicle adoption should continue however, and will certainly help boost the silver price in 2022 going forward.

Silver Forecast

One of the key factors that could see the price of silver rise in the next year or two is the gold to silver ratio. Simply put, this is the relative difference in value between an ounce of silver and an ounce of gold.

By looking at the chart below you can see the history of the gold to silver ratio:

Silver ratio historical chart
Since March 1970, the average gold to silver ratio is 55, as represented by the yellow line. A ratio of 80 is considered a high point in recent years, and it has only gone above this four times, not including the current ratio; 1990, 2003, 2008 and 2016. Today's ratio of 85 is the highest since the huge peak in disparity of 1990 (as seen by the red line), and the question of how long it could continue to rise is something on the minds of all silver investors. The few times the ratio has gone above 80 in recent years has usually been followed by a quick drop to more reasonable ratios of 53 (in 2004), and 68 (in 2011).

The current ratio has already broken this trend by staying above 80 for nine months, and increasing to 85, but when it does come down the increases in the price of silver could be significant.

2020 Update: The gold-silver ratio has continued to maintain the gap between the two metals so far in 2020, sitting currently at 89. This is in-line however with both metals seeing growth throughout 2019. More and more analysts however are pointing the disparity between the two, and wondering how much longer silver will remain so far below gold.

Economic growth is still under threat in 2020. The Eurozone in particular is close to recession, with key countries like Italy and France posting negative economic growth at the end of 2019. Germany is also under threat, with an economy essentially stagnating for nine months. The recent outbreak of the latest coronavirus has put even more pressure on these already ailing economies. The impact of coronavirus is still largely unknown, with new cases being reported daily, and cases outside of China raising the risk of a global pandemic.

Lastly, supply of silver could be under threat; Mexico, the world’s biggest producer of silver, elected a new President in 2018. Just a few months later a Bill of Law was submitted with the intent to investigate the impact of mining in Mexico, and make changes to the laws as required. This could see mining sites take longer to be approved, or current concessions revoked, if the environmental or social impact is deemed unreasonable. With one of the key suppliers of silver under the threat of such big changes, this could see the silver supply reduced.

Demand for silver continues to be high, with new uses in medicine and technology being announced regularly. Of particular interest for silver, the recent surge in environmental concerns will likely see a rise in demand for solar panels. The need for sustainable energy could help silver jump to new highs. We expect that this increase in demand will make silver supplies scarcer, and drive the price up accordingly.

Update 2022: After the gold to silver ratio reached a record high of 123 in 2020 it has since fallen back, but remains above historical averages. Sitting at around 80 at the time of writing, gold remains close to its all-time high, while silver still has a long way to go. The gold to silver ratio could point to some further gains to come for the silver price in 2022.

Sell my silver?

As with any investment, the decision to sell rests solely with the individual. The price of silver has struggled to stay as high as gold during the global pandemic, which could suggest more of a buying opportunity than selling.

We have seen very fast gains for silver before however, and any momentum could quickly turn into a full bull run for silver that could see prices soar, and provide a good time to sell silver for many investors.