Silver Price Nears $42, $50 by Year-End?

SILVER PRICE NEWS – The silver price climbed as much $1.04, or 2.5%, to $41.975 per ounce in overnight trading on Monday, its highest level since the days of the Hunt Brothers in January of 1980.  However, the silver price turned lower in afternoon trading, by $0.19, or 0.4%, at $40.75 per ounce.

Silver equities traded lower alongside the silver price this afternoon, as the Global X Silver Miners ETF (SIL) dropped $0.65, or 2.1%, to $30.22 per share.  Notable decliners in the sector included Hecla Mining (HL), Pan American Silver (PAAS), and Silver Standard Resources (SSRI), with losses of 4.3%, 1.9%, and 1.4%, respectively.

Despite its move southward on Monday, the silver price has now posted a new 31-year high on four of the seven trading days thus far this month. Furthermore, at its intra-day high today, the price of silver had extended its year-to-date gain to 35.6%, far outpacing gold and most other commodities. The near-parabolic advance in the price of silver in 2011 has been fueled by its dual role as a precious and industrial metal, as well as rising investment demand across the globe.

GFMS, one of the world’s most prominent metals consultancy firms, last Friday predicted in its Silver Survey 2011 that the silver price may cross $50 per ounce by the end of the year.  In a presentation by Chairman Philip Klapwijk, GFMS noted that when adjusted for inflation, the real all-time high in the silver price is $92 in today’s terms, as compared to the $50.35 nominal high it reached in January 1980.

The firm cited several factors in its bullish silver price forecast – including quantitative easing, inflation fears, and a weak U.S. dollar.  GFMS also highlighted that market-listed silver investment holdings increased sharply during the last four months of 2010 to 582.6 million ounces.  This trend has continued in 2011, as silver investment holdings rose by 30 million ounces over the past two months.

(Source: http://www.goldalert.com/2011/04/silver-price-nears-42-50-by-year-end/)