China and silver have enjoyed a strong bond right from when it still issued a silver related currency in the early twentieth century. The entry of China into the global silver market is likely to end COMEX manipulation and reduce the volatility of the precious metal to a certain extent.
Silver needs to discard the volatility tag that gives it such a bad image. Also known as ‘devil’s metal’ by some traders, China’s entrance may further reinstate traders’ belief in silver as an undependable asset. But sooner or later, silver is bound to find stability.
Chinese retail investors are attracted to silver investment for its lower price than gold. The Asian country is one of the largest silver miners and the biggest consumers of industrial silver. At present, silver bullion and jewellery have attracted many investors doubling their investment with passing days. China is also a major importer of silver for industrial and fabrication purpose, mainly in electronic and solar products.
The current state of positive beliefs about gold is impacting silver’s impending predictions as forecasters believe it will possibly rise to $50 an ounce, riding high on gold’s success. HSBC relies on its gold’s affirmative forecast, where it has prophecised that the precious metal will cost $1,850 per ounce in 2013. Investors depend on these and similar forecasts for gold as they continue to analyze silver’s future. But what holds for gold may not be for silver. They need to have a neutral view of silver, irrespective of what lies ahead for gold. In such situations, the future outlook for silver is raising concerns. Continue reading →