Silver Price Outlook – August 2023

“Silver prices, like those of gold, rose during July after falling during May and June. Silver prices ended July at $24.97, making back around 66% of the losses that were seen from the highs of May to the lows of June.

Not only did silver make back more of the loss that it incurred during May and June compared to gold, but the gold:silver ratio also declined sharply during July. The ratio slipped to 80.9 in July on a monthly average basis, which was down from 85.1 in June and was at the lowest level since April when it stood at 80.1.

Silver’s advantage over gold last month was that it benefited from its hybrid role as both an investment as well as fabrication metal. Healthy economic conditions around much of the world helped to support fabrication demand, while investor sentiment improved toward silver in part due to the expectation of limited to no further monetary policy tightening. This expectation was based on inflation showing signs of sustaining its downtrend, which has been in place since the second half of 2022. Investor sentiment was also boosted in part because of healthy fabrication demand and expectations of stronger fabrication demand on the back of healthy economic conditions in most parts of the world.

Silver prices are likely to move in a sideways fashion with a downward bias over the next few months. Prices are expected to move in a range between $22.40 and $25. Seasonal weakness in prices is expected to weigh silver over the next few months. Silver prices have some initial support around $23.50, which if broken could take prices toward $$22.80 or $22.40. If these levels are broken forcefully, a move toward $21 should not be ruled out.”