[Christian Harris]

Silver has experienced a remarkable surge in demand across multiple sectors in 2024, propelling its price to levels not seen in over a decade.

The precious metal’s value reached a 12-year high, with prices touching nearly $35 per ounce, marking a 34% increase since the beginning of the year.

This impressive performance has outpaced gold, which saw a 26% year-to-date gain.

Demand Drivers

The robust demand for silver stems from various industries. Industrial demand is forecast to surpass 700 million ounces for the first time on record, growing by 7% in 2024.

This growth is primarily driven by:

• Green Technologies: The photovoltaic sector has seen significant expansion, with silver being a crucial component in solar panels.
• Automotive Industry: Increased vehicle sophistication and the shift towards electric powertrains have boosted silver usage.
• Electronics: Despite challenges in consumer electronics, the rapid adoption of AI technologies has spurred demand for technological upgrades and infrastructure investments.
• Jewellery & Silverware: These traditional sectors have shown a recovery, contributing to the overall demand increase.
• Investment Demand: While physical investment has seen a decline, exchange-traded products are on track for their first annual inflows in three years.

Supply Constraints

The silver market is set to experience a sizeable structural deficit for the fourth consecutive year.

Mine supply is projected to rise by only 1%, failing to keep pace with the growing demand. This supply-demand imbalance has been a key factor in driving up silver prices.

Safe-Haven Status

Despite its industrial applications, silver continues to maintain its status as a safe-haven asset.

During periods of political and economic uncertainty, investors often turn to silver for its ability to preserve wealth.

The metal has historically outperformed gold during times of geopolitical and financial instability.

Future Outlook

As we look towards 2025, silver’s dual nature as both an industrial and precious metal positions it uniquely in the market.

Its industrial demand is expected to continue growing, particularly in sectors like renewable energy and electric vehicles.

Meanwhile, its role as a hedge against economic instability and currency devaluation remains strong.

With ongoing global economic uncertainties and the potential for interest rate cuts, silver’s appeal as both a growth asset and a safe haven is likely to persist.

Analysts project that silver prices could reach $48 by mid-2025, indicating significant potential for further appreciation.

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