RBC's silver price forecasts remain unchanged at $15 per ounce this year and beyond.
The silver price average $14.65/oz in 2009, a 2% drop from 2008, RBC metals analysts noted. For 2009, silver mine production is believed to have risen 2% over 2008.
The analysts maintained their positive outlook for silver in the short-to-medium term of one to three years, based on:
- Continued fundamental outlook for a weaker U.S. dollar, which will likely result in strong precious metals prices.
- Fundamentals for silver remaining positive, with demand increase for industrial and investment segments forecast to more than offset the continuing decline in photographic demand.
- Medium- to long-term concerns for increasing primary silver supply remains, which the analysts believe could eventually cap the upside for silver prices.
Noting that total silver ETF holdings grew by 122 million ounces last year, the analysts expect "continued strength, but at slightly lower levels than seen in 2009, with our forecast of 90 million ounces of silver ETF demand."