LONDON (Commodity Online) :
Silver can go only one way this year, that is towards north even though its glittering cousin, gold might find it difficult to catch up with the white metal.
The latest scenario (war,tsunami,nuclear leakage) provides both silver and gold, opportunities to scale new highs on their safe haven appeal, analysts said.
Silver gained nearly two percent and hovered near $35 an ounce ever since crisis crippled world’s third largest economy, Japan.
Analysts said the white metal suddenly become a hot commodity purely on incidents happening on two corners of the world as traders and investors turned their attention to precious metals.
The world's largest silver exchange-traded fund, iShares Silver Trust, increased its holdings to record levels since.
They attributed the rise in silver futures to a firming trend in global markets as unrest in the Middle East and crisis in Japan boosted the demand for the precious metal as a safe haven investment .
Silver in particular looked bright ever since it broke the important 40:1 ratio against gold (before in Jan 2011 ratio is 55:1). Its relative strength against gold is increasing.
Silver prices have seen a steady increase in the last decade as analysts said the white metal also offer a lot of security in unstable economy and markets.
2011 started off as year of events and any major events will boost precious metal’s appeal. The silver prices for bullions and coins are monitored every day as these prices change but most of the time, the change is positive.
Japan crisis is expected to help silver reach record heights as unlike gold it has a separate use as an industrial metal, in addition to its safe-haven appeal. Japan will require lot of silver to rebuild while China is expected to increase its silver intake by three times.
In 2011, silver’s Industrial demand is expected to fill nearly 50 percent of its total use with the increasing use of electronics and electrical uses.
Silver miners are also geared up to tap more of the white metal after demand soars. Output from primary mines rose to nearly forty percent last year compared with thirty percent three years ago.
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