There is a good upside potential in 2012 Silver prices – BofAML

Bank of America Merrill Lynch (BofAML) estimated that there is a good upside potential in 2012 Silver prices. As per the bank, prices should average $34/oz, followed by $37/oz in 2013, because of continued interest in the metal. Also, the bank believes that $30/oz silver is justifiable at present.

According to BofAML, silver fundamentals have been improving in recent years for a host of reasons, including increased demand from emerging markets, somewhat reduced drag from the photography sector and higher usage from new applications. This suggests that gradual increases of silver quotations were justified.

Usage in applications like solar panels should increase going forward. Demand from the photography sector has fallen steadily and scope for further large reductions in offtake is limited.

Nevertheless, price rises seen of late (in particularly quotations at around $50/oz) were in bank’s view heavily influenced by speculative interest. Chart 110 and Table 10 presents the situation from the angle of industrial production, showing that a slowdown in economic growth is usually not conducive to an out performance in Silver prices. – CommodityOnline

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Posted by Silver Guru on Dec 20 2011. Filed under Silver Analysis. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry