We continue to publish analysts' predictions for 2023 with Alex Kuptsikevich's, Senior financial analyst at FxPro view on precious metals market. Alex was asked how will the price of an ounce of gold/silver change in 2023, how will the demand for precious metals change in 2023 from industry, central banks, investment funds, and the jewelery industry and how will the valuations of listed companies operating on the gold and silver market (mining companies) change in 2023.
The price of gold could comfortably surpass $2000 this year. There is also a nice chance of renewing historical highs at $2070. An impressive momentum and the subsequent month of strong buying are often a companion to the end of a bearish trend. Both of which we saw in November and December. And while gold remains vulnerable to local corrections, the upside path has already begun. Silver could end the year in the $28-30 range. With less liquidity, silver has higher volatility, which promises stronger gains in the current growth cycle.
Central banks were buying gold at the end of the year at the highest rate since 1955. Net purchases by central banks are likely to continue as purchases of dollars for reserves may be delayed while interest rates rise. Gold and silver could be the choice for populations in the world's largest economies, from the USA and China to Germany and India. On the other hand, industrial and jewellery demand risks being suppressed by the global slowdown.
Gold mining stocks have lost more than the underlying asset price from peak to bottom but may now begin a more robust recovery. This industry is less dependent on the inflow of cheap money and, therefore, less sensitive to high rates. A rise in the price could attract investor interest in undeservedly low share prices with a comparatively rosier outlook.
