Silver Prices May Fall again in 2015

silverLondon: The per-ounce price of silver is expected to decrease this year as the dollar continues to strengthen and investments move out of the commodities sector. However, the metal could end the year on a strong note, according to the National Jeweler.

In an email to the news portal, London-based analyst Andrew Leyland, manager of precious metals demand at Thomson Reuters GFMS, said that they are predicting the average silver price to decrease to $16.50 per ounce in 2015, down from just above $19 last year.

“The driving factor behind silver prices this year won’t be supply or physical demand but its attractiveness as an asset class for institutional investors, in our view,” Leyland said. “We’re continuing to see money move out of the commodities sector, into equities and fixed income, and this, along with a stronger dollar, has been underpinning weakness.”

He added that Thomson Reuters GFMS expects the silver price to end the year on a strong note and for the average to increase by a full dollar, to $17.50 per ounce, next year.

The London Bullion Market Association also released its prediction for 2015 prices, with analysts forecasting an average price of $16.76 per ounce for silver–slightly higher than the Thomson Reuters GFMS forecast–with prices ranging throughout the year from $13.91 to $19.36.

The contributors named a number of factors behind this prediction, including the expected strengthening of the dollar, disinflation and slow growth from China and the Eurozone, all of which will push down the silver price.

The lower price of silver is continuing to have a positive effect on silver jewelry demand, and Thomson Reuters GFMS said that it is continuing to see a trend toward heavier pieces and movement away from plated products toward sterling silver.