Proactive Investors - Gold and silver prospects for 2024 have improved sufficiently for the analysts at Deutsche Bank (ETR:DBKGn) to increase their price targets for both metals.
Gold gets a nudge up on the basis that the US Federal Reserve starts its easing cycle in the middle of the year and buying of the metal by central banks continues.
“We expect gold to end next year at a quarterly average of US$2,150/oz, with potential to trade above US$2,200/oz.”
Geopolitical issues, too, are likely "to simmer in various forms" as background support for gold with the elections in Taiwan and the US adding to the mix.
Emerging country central bank buying is the most enduring and direct linkage between geopolitics and gold, says the bank, in that gold can provide a form of insurance against possible sanctions on central bank assets.
For silver, Deutsche Bank says it is bullish to US$26/oz in the fourth quarter and US$27/oz in 2025.
“We see silver as one half of a contrasting secular picture for the precious metals and energy transition.
“Silver benefits from rising photovoltaic demand where an increasing pace of annual installed volume continues to outweigh the impact of thrifting.
“Also, electronics silver demand is set to rise as semiconductor supply chains improve and sales rebound.
“As a result, we expect silver undersupply to continue in a significant magnitude, about -13% to -14% of the market in 2024 and 2025."