Price of Silver to Soar in 2016
While silver is not as scarce as gold, silver has become very attractive to investors across the industry. As silver prices have soared to an 11-month high in the recent months, silver continues to improve in price and provide investors with wicked gains compared to gold.
Silver Prices Rising on Trojan Stock Market
After a record four consecutive years of declines, silver has been rewarding precious metal bulls in 2016. Currently exchanging hands at around $17.00 an ounce, silver prices are up 23% year-to-date.
Silver has turned bullish for two main reasons. For starters, the admirable rebound on the stock market is not what it appears. Silver will continue to get support on global economic concerns and geopolitical tensions.
Silver Trends for 2016
What many investors tend to forget is that in addition to being used as a hedge against economic uncertainty and for jewelry, silver is an important industrial metal. In fact, the industrial use for silver accounts for half of the world’s annual silver demand.
Silver is used in medical technologies, nanotechnology, batteries, electronics, windows and glass, the automotive industry, and green technologies, such as solar energy and water purification. Before the financial crisis in 2008, silver was in huge demand as global manufacturing boomed.
In particular, silver is a major component in photovoltaics for solar energy. (Source: Northern Miner, February 2016.)Demand for silver coins is also expected to be robust and should help drive silver prices higher. While silver prices have surged in 2016, silver is still significantly cheaper than gold—and more attractive as a safe haven investment.
Finally, demand for silver will come as production levels are projected to fall by as much as five percent from 2015 levels. But the recent rally in silver prices has leveled out the ratio to around 74 and shown silver to be a better bet. Year-to-date, silver prices are up 23%.