【MACRO Alert】Silver soars, gold shines - a panoramic view of the precious metals market in 2024

In 2024, the precious metals market performed actively, with the price increases of silver and gold being particularly eye-catching. This article comprehensively analyzes the contents of the two documents and explores the future growth trends of these two precious metals.

Silver: Industrial demand and investment enthusiasm

Silver, an investment asset and industrial metal, has risen more than 35% in 2024, with spot prices reaching their highest level in more than a decade at $32.71 an ounce. T

Ole Hansen, head of commodity strategy at Saxo Bank, pointed out that China's economic stimulus policy is boosting the industrial metals market, which is a positive sign for silver traders. He expects the gold-silver ratio to fall back to the 70-75 area, and silver may outperform gold by 10%. The gold-silver ratio is measured by the number of ounces of silver that can be exchanged for one ounce of gold, and the market uses it to predict future trends.

Citi analyst Max Layton expects that interest rate cuts may provide bullish momentum for global economic activity, support silver consumption, and silver prices will rise to $35 in the next three months, and may rise to $38 in the next 6-12 months. Macquarie predicts that the supply deficit in the silver market will continue in the next five years, but the integration of China's solar industry may pose resistance to silver in the short term.

Nevertheless, Hamad Hussain, assistant climate and commodities economist at Capital Economics, warned that the rise in silver prices may be difficult to sustain in the coming months as some positive factors may fade as the probability of the Federal Reserve cutting interest rates again in November is overestimated.

Gold: Long-term prospects are promising, but short-term caution is needed

Although Wall Street investment banks are optimistic about gold's long-term prospects, its crazy short-term rise has caused some concerns. Gold futures reached a record high of $2,684.7 per ounce, up about 29% so far this year.

Independent analyst Ross Norman believes that despite the rise in the dollar and U.S. Treasury yields, gold's positive momentum is attracting speculative inflows. The Bank of America report predicts that gold prices may rise to $3,000 an ounce in the next 12 to 18 months, but ETF strategist Jared Woodard warned that gold may be tactically overbought.

UBS strategist Wayne Gordon raised his price target for gold, but warned of a possible short-term pullback. UBS expects gold prices to reach $2,750 an ounce by the end of 2024, rising to $2,850 an ounce by mid-2025 and $2,900 an ounce by the third quarter of 2025.

BTIG strategist Jonathan Krinsky reminded investors that considering the long-term rise of gold, it may be worth considering taking profits at the current level and then buying on dips. He suggested that investors pay attention to the price changes of SPDR Gold Trust (GLD), the world's largest gold ETF, and believed that a drop back to the 225-234 range would be the time to buy again.

Summarize

In summary, silver and gold, as precious metals, have shown strong growth momentum in 2024. Silver's growth mainly depends on China's economic stimulus measures and the Fed's interest rate cut policy, while gold's long-term prospects remain optimistic. However, for both precious metals, market analysts have raised challenges and callback risks that may be faced in the short term. While pursuing high returns, investors also need to pay attention to market dynamics and plan investment strategies reasonably.