Commodity Tips, Budget, rupee hold the key to silver’s prospects
The ongoing debate in the global precious metals market is not so much about the gold market outlook as about silver. Economic growth, geopolitics, monetary policy and currency factors are set to impact the market outlook in the coming months.
The flow of speculative capital, which usually exerts an exaggerated impact on prices, will depend on the behaviour of the major drivers.
No wonder, divergent views over the likely trajectory of silver prices in 2018 have emerged; all the views on the upside potential and downside risk are equally forceful.
Apart from being in the precious metals complex, silver also has the plethora of application as an industrial metal with the sector consuming 50 percent of the total production. So, when prices of industrial metals rise, silver tends to gain.
Mixed outlook
Many bankers see upside price possibilities emanating from geopolitical tensions that will fuel haven demand. At the same time, positive growth signals, a firming dollar and strong US Fed rate hike expectations cap the upside for silver prices. The consensus price has veered around $17.5 an ounce annual average for 2018, with the maximum at $19.4 and minimum at $15.8.
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