NEW YORK (Kitco News) - Silver has finally caught up to gold's rally, with prices hitting 15-month highs earlier in the week, and according to one analyst closely watching the metal, the optimism should continue.
"We expect the silver price to average $15.90 this year and that's going to be defined by an overall upward trend," Erica Rannestad, precious metals demand senior analyst for Thomson Reuters GFMS, told Kitco News. "We've seen prices reach highs last week and we expect that trajectory to continue through the 4th quarter of this year."
Prices are expected to close the year around $16.80 an ounce, Rannestad added, on the 26th World Silver Survey's release date. The annual report, which offers a comprehensive look into the silver market's fundamental drivers, was released Thursday morning by GFMS in collaboration in collaboration with the Silver Institute.
The silver market saw record demand in 2015, but had its third successive annual deficit, which was 60% larger than 2014. These were just a few of the findings of this year's report.
However, the report is backward looking and the silver market is much different today than it was towards the end of last year. Since the start of the year, silver futures have ripped through resistance with July Comex silver at $17.48 an ounce at the time of the report's release.
Rannestad agreed in that interest for silver has shifted, which is helping to support prices this year. "First off, in the past 2-3 years, you've seen bargain buying. This year, you've seen a lot more safe-haven buying, which has been pushing prices higher," she explained.