Analysts at Citigroup Bank predicted that the price of silver would continue its strong upward trend, suggesting that the spot price of the white metal would reach a record high of $150 an ounce within the next three months, given the continued strong buying momentum and the worsening supply shortage in global markets.
The bank's analysts explained in a note released on Tuesday that investment demand, particularly from the Chinese market, remains the main driver of rising prices, along with declining investments in silver-backed exchange-traded funds, which reduces the quantities available for trading and increases upward pressure.
The report noted that the recent surge was exceptional, with the price of silver jumping by about 50% in one month, reflecting significant speculative activity in the futures markets, as well as the growing demand for silver as a hedge asset amid escalating geopolitical and economic risks.
Citigroup analysts added that continued price increases are necessary to push current silver holders to sell, which would help alleviate the shortage of supply in the physical market, stressing that silver's price behavior has become more robust and active compared to gold, and this relative superiority is likely to continue in the coming period.
The report noted that silver could see further gains if the gold-to-silver price ratio returns to the historically low levels recorded in 2011, at 32 to 1, a scenario that could push the price of silver to around $170 an ounce.
This assessment reflects an optimistic outlook for silver’s near-term prospects, at a time when investors’ appetite for tangible assets and safe havens is growing, amid a global environment characterized by uncertainty and high levels of volatility in financial markets.