By Paul Ploumis 16 Jun 2015 Last updated at 08:34:38 GMT
NEW DELHI (Scrap Monster): According to analysts at the UK research firm Metals Focus, Silver prices are likely to remain lower during 2015. The prices are likely to average around $15 per Oz during summer, but may creep up to $16 per Oz levels by fall. A major rebound in silver prices is likely o happen only in 2016, stated Philip Newman while addressing the International Precious Metals Institute meeting in San Antonio.
According to Metals Focus, Q4 is seasonally a strong quarter for gold in India and China-the two largest consumers of the yellow metal. The uptick in gold sales should favor silver, as silver prices generally moves in tandem with gold prices. The average silver prices in 2015 are likely to remain 15% lower than previous year. However, Metals Focus sees 10% rise in average prices for silver in 2016.
There are quite a few key factors that could determine the price movement in the near term. The most important among them is the timing of US Fed’s decision to hike interest rates. The rate increases are expected to happen in a gradual manner, which in turn could augur well for precious metals. The second factor that may impact precious metal prices is the likely exit of Greece from Eurozone union. The impact on bond yields may keep the gold-silver ratio at current levels of 70-76:1 during the rest of the year and early next year.
Newman stated that silver has witnessed increased retail demand in India during the initial five-month period in 2015. Indian Silver demand has climbed higher by nearly 20% during this period when compared with the previous year. The yearly import levels in 2015 are expected to surpass those during the previous year. In addition, silver has witnessed tremendous addition of interest by US institutional investors, although investment demand has fallen from the record highs last year.
The buoyant demand for silver in India and upbeat investor demand in the US may lend support to silver prices in 2016.