Silver to average $31 16 Oz in 2013

Last Updated : 14 January 2013 at 22:05 IST

?Silver to average $31.16/Oz in 2013? Source :Commodity Online/Sharps Pixley

An improved economy should encourage silver‘s industrial demand, but there is a danger that sharp rises will be seized upon by producers as an opportunity to sell forward, effectively capping the rallies. With primary mine production continuing to rise to new record highs, the onus is increasingly on the silver bulls to prove the case.

NEW YORK (Commodity Online): Silver prices are expected to average $31.16 per ounce this year and some softness is expected as fear trade evaporates and speculators look to reduce their positions commensurately, said Sharps Pixley in a commodity research note.

According to the firm, an improved economy should encourage silver’s industrial demand, but “there is a danger that sharp rises will be seized upon by producers as an opportunity to sell forward, effectively capping the rallies. With primary mine production continuing to rise to new record highs, the onus is increasingly on the silver bulls to prove the case.”

Gold bull market remains intact, but the and patience of gold investors may be tested in 2013 which forecasts gold prices to average $1,736 an ounce this year, Sharps Pixley continued.

An improving macro-economic environment in the U.S. will support the dollar, and reduced “fear trade” could limit price gains.”For a market used to a 17% y-o-y gain, a single-digit percentage increase may feel like a bear market,” they added.

The U.S. debt ceiling debate is a caveat to their forecast: “a fudged outcome could of course generate far higher outcomes,” they concluded.

Source

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