HSBC Sees Higher Silver Prices Before Year’s End

Investment bank HSBC has stated its belief that silver prices could rise to $23 per ounce before the end of 2013, a price marker that would represent a 17 percent gain from today’s spot price of $19.70 per ounce. The bank also believes that silver could fall to $17, meaning that if silver first falls to $17 then rises to $23 a gain of 35 percent would re realized.

“A 35 percent movement in a matter of months is not exactly common, but it isn’t unheard of, either,” says chief technical analyst Peter Black. “Silver has a high level of industrial and jewelry use, and the amount of silver that companies in those industries use varies greatly from quarter to quarter.”

HSBC lists jewelry, appliance, auto, coin, medical, bar and Indian import demand as influences that could boost silver’s value before 2014 arrives. HSBC’s silver forecast is now slightly higher at $22.90 for 2013, while forecasts for 2014 and 2015 remained unchanged at $20 and $20.25, respectively.

“Silver prices will be determined largely by the interplay between currency levels, monetary and fiscal policies, geopolitics, the price of other precious metals, notably gold, and silver’s underlying supply/demand fundamentals,” HSBC said. The bank also said that while there is an abundant amount of silver above-ground, the cost of silver mining remains low and demand could increase exponentially if the dollar’s recent gains are reversed and if the BRIC nations (Brazil, Russia, India and China) continue to support silver with large buys, both at the national and individual levels.

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