Silver Institute: The white metal is heading for "fantastic year" in 2024, could outperform gold

The Washington-based Silver Institute said in its latest report that 2024 will be a “fantastic year” for the white metal, with prices potentially rising to 10-year highs.

The institute expects silver demand to hit 1.2 billion ounces in 2024, the second highest on record. 

The non-profit organization said that strong industrial activities will drive demand on silver, as manufacturing scales up worldwide this year. 

Silver is used industrially in car manufacturing, solar panels, electronics, and in jewlery. 

The institute expects silver prices to hit $30 an ounce this year, a 10-year high. 

Expected Surge in Global Demand

The Silver Institute expects global demand on silver to surge by 9% this year, with a 6% increase in jewelry demand, led by India and the US. 

An expected uptick in consumer electronics will boost silver demand as well. 

Short-term Hurdles 

The institute acknowledged some short-term hurdles, namely China’s economic slowdown, while odds of early US interest rate cuts recede. 

However, things could change in the second half of the year, when analysts expect the Federal Reserve to start cutting rates and easing policies. 

Inverse Relation

Silver and other precious metals have an inverse relation with interest rates due to their non-yielding nature, which makes them a less enticing investment when interest rates are higher. 

Will Silver Outperform Gold?

Silver is known as gold’s poor cousin, however silver is much more used in actual industries compared to gold, thus it’s more linked to global economic performance. 

Gold on the other hand gets more support in times of uncertainty for its haven appeal. 

The institute expects silver to easily outperform gold this year as the global economy rebounds and accelerates.