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The prices of precious metals dropped back last week. Silver was the worst performer, with the price falling by around 5% as investors continued to sell holdings in ETFs and the prices of industrial metals declined more broadly. As a result, the gold/silver ratio ticked up. Elsewhere, the price of platinum eased back this week, while the price of palladium was little changed. Strategists at Capital Economics update their forecast for these precious metals by the end of 2021.

Key quotes

“We expect the price of silver to continue to fall relative to gold as industrial metals prices drop back. Our end-year forecasts are $20 and $1,600 per ounce for silver and gold respectively.”

“We think that the short-term outlook is brighter for palladium than platinum. Our view is primarily due to demand-side factors, which we think will keep the palladium market in deficit and push the platinum market back into surplus.”  

“We have revised up our end-year forecast for palladium to $2,700 per ounce, while we think platinum will fall to $900 per ounce.”