Russian Central Bank will acquire silver reserves
In an important development, the Russian central bank has announced plans for the first time to add silver to its reserves. The move is part of Russia’s broader strategy to diversify its holdings of precious metals, which already include gold, platinum and palladium. The addition of silver could create a new layer of demand, which could provide strong support for the metal in the coming months.
Historically, central banks have focused on gold, but Russia’s diversification into silver indicates the metal may be undervalued. Analysts believe that industrial demand for silver, especially in the areas of photovoltaics and electronics, increases its appeal. This development could push prices higher, with some experts predicting a 50% increase in prices over the next two years as central bank demand and industrial use increase.
Gold near record high; Safe haven demand is supporting silver
Gold’s recent rise to near-record highs has had a spillover effect on the silver market. Gold is hovering just below Monday’s record high of $2,740.00 as geopolitical tensions and global economic uncertainty drive demand for safe-haven assets. The metal’s upward trend, fueled by strong ETF inflows and rising central bank purchases, has also indirectly boosted silver prices, given the correlation between the two precious metals.
While gold remains a preferred haven for investors amid the uncertainty surrounding the US elections and global tensions, silver is benefiting from the same sentiment. Silver often follows gold during times of heightened risk aversion, with investors turning to silver as a more affordable alternative to preserving their wealth.
Market Forecast: Bullish for Silver
The outlook for silver remains bullish in the near term, with prices rising towards $35.40 and potential for further gains. The Russian central bank’s silver purchases, combined with industrial demand and gold’s strong performance, are creating a favorable environment for silver. Traders should be cautious of short-term pullbacks, but any dip is likely to attract buying interest, especially as central banks increase their focus on precious metals.
As long as gold continues its upward trend, silver will likely follow suit. Investors should keep an eye on key levels, with continued upside potential if the $34.35 resistance is convincingly broken.