2020-08-05 22:44
publication
2020-08-05 22:44
–
–
For several weeks, silver has risen even faster than gold, breaking historical records. However, white metal is still almost half the price it was in April 2011. Bank of America analysts, however, forecast the rate at USD 50 per ounce.
Wednesday brought further increases in the prices of precious metals. As in previous days and weeks, they were fueled by the weakening dollar and concerns about a decline in the purchasing power of fiat money caused by unprecedented “reprinting” of the currency by the Federal Reserve and other central banks.
Only on Wednesday silver went up by over 3%, hitting $ 27.06 an ounce. From the beginning of 2020, white metal has already increased by 51% and has reached the highest prices since April 2013. However, there is still a long way to go to the 30-year record from April 2011 ($ 49.53 / oz.). Silver would have to travel another 83% to compensate for this nominal peak.
Bank of America analysts see this scenario in their forecasts. In their opinion, the combination of ultra-loose monetary policy with powerful fiscal packages aimed at the development of “green” energy (especially in the European Union) is the perfect mix for higher silver prices in the future. The forecast for next year is $ 35 / oz, with the potential to reach $ 50 / oz. in the “medium term”.
Contrary to gold, silver is nowadays primarily an industrial metal. It dropped out of the monetary system over a hundred years ago and is unlikely to come back to it. It is worth noting, however, that in recent weeks there has been a sharp drop in the parity between gold and silver. Currently, an ounce of gold is worth just over 75 ounces of silver. At the end of March, this relationship reached an all-time high of 128.
Simultaneously on Wednesday the nominal price of gold set a new all-time record at $ 2,056.90 per troy ounce. Late in the evening, the most active series of New York gold contracts was traded at $ 2,041.10 / oz., 0.8% higher than the day before. Since the beginning of 2020, the dollar price of gold has risen 34%. If the current price level continues until the end of December, it will be the largest annual increase in gold prices since 1979.
Palladium (2.2% to $ 2,228.50 / oz) and platinum (3.4% to $ 993.75 / oz.) Also rose. However, fans of precious metals argue that it is not so much ores that become more expensive, as fiat money “printed” for power loses its value. In this context, it is also worth relating the current nominal prices to the real prices from 40 years ago. . According to official data from the US Bureau of Statistics work then $ 850 would now be worth $ 2,816.55.
Krzysztof Kolany
–
