Ratio b/w Gold and Silver should be narrowing

UNITED STATES January 22 2015 11:46 AMTweet 
NEW YORK (Scrap Register): Silvers prices have more room to run higher, according to analysts from CIBC Capital Markets, but they are not ready to change their forecast just yet.

According to CIBC, they are disappointed that the gold:silver ratio has not narrowed further. The ratio tends to expand when gold is going down and contracts when gold is on a rising trajectory.

"Though the gold/silver ratio has come down a little from a high of 75x to the current 72x, silver remains trading as if gold will likely contract again," analysts added.

"Given the view that the rally is not quite done yet and backed by a gold trading model that is not yet delivering a sell signal, we prefer to stick with the current trend for a while longer even though we are not increasing our silver price forecast of $17/oz. at this time," CIBC noted.