According to StoneX Financial, silver is expected to outperform all precious and base metals in 2025 due to its monetary status and increased industrial demand. Rhona O'Connell and Natalie Scott-Gray of StoneX highlight that silver, along with copper and tin, will be the best-performing metals this year.
The growth of the green and digital transitions favors these metals. Despite a strong performance in 2024, silver is expected to continue to stand out in 2025, driven by the solar industry and other emerging technologies. Investment in silver will remain strong, with expectations that its price will reach $33 by the end of the year.
In summary, 2024 was a year of transition for the balance between silver supply and demand, and it is expected that, starting at the end of 2024, the market will enter a deficit that will widen in the coming years due to solar energy, artificial intelligence, and the electrification of transportation.
The authors also point out that silver has historically been a precious metal due to its use as currency and in jewelry. Although its relationship with gold is important, silver also behaves like a base metal in certain contexts. During recessions in the US, its price tends to align more with copper than with gold, while in inflationary periods the opposite occurs.
StoneX identifies two main reasons for this duality: the nature of silver supply and the perception of investors who see it as an affordable alternative to gold. In addition, silver has shown significant volatility, moving at least twice as much as gold in times of conviction.
This year, silver could chart its own course, driven by the solar industry, which uses silver in photovoltaic cells. Demand for silver in solar energy is estimated to grow by 16% annually through 2027. Artificial intelligence will also contribute to demand for silver, which is necessary for energy support and transportation infrastructure.
Despite volatility, the revitalization of the gold and silver markets in 2024 has kept investors interested. However, silver is susceptible to impulsive reactions and must be handled with care. Trade policies, such as possible US tariffs on Mexico and Canada, may also affect its market.
StoneX projects that silver prices will average $32 in 2025, rising to $33 by year-end, representing an annual gain of 14.1%.
Ernesto Hoffman, Kitco News