Yesterday, HSBC (NYSE: HBC) analysts upgraded silver forecasts for this year and the next, citing flexible monetary policies and burgeoning demand in the industrial sector—where silver is primarily used.
Over this year, MarketWatch reports that analysts project silver going up to $33/oz (that’s an upgrade from the earlier number of $32/oz), and 2014 could see $31/oz over $28/oz.
Primarily, investor demand for hard assets, increased industrial demand, continued strong coin and bar buying across the market, and collapsing jewelry demand will keep silver prices strong, analysts believe.
From Fox Business:
“We have updated our supply and demand model and conclude that the global silver surplus will likely narrow to 188 million ounces this year from 210 million ounces in 2012,” said HSBC analyst James Steel.
In part, silver mimics gold in that both constitute good safe-hedge bets in uncertain times against inflation and devalued currencies.
Of course, increases in mine production, demand for jewelry, and scrap supply levels can all modify these projections.