Silver “has the most potential to benefit from a sustained rally in gold” among the precious white metals, reckon UBS analysts.
While not at all-time highs like gold, silver recently touched five-year highs against the pound sterling, with spot prices exceeding £22 per ounce. There could be more upside to come.
“Silver has started to gather some attention in early second quarter, following the relentless rally in gold to new all-time highs,” said UBS analysts.
“With many investors caught off guard by the speed and magnitude of gold's ascent, silver has been offering market participants a chance to catch up.
“We think it is still early days, with silver's year-to-date outperformance still relatively muted compared with its historical behaviour.”
Investment demand and green technology trends could help to drive silver's demand, UBS added, as could wider risk-on sentiment in the wake of interest rate cuts, while "higher volatility is likely to also attract more active investor participation”.
As for the two other white metals, platinum “continues to require patience for the market to work through inventories” while palladium “is likely to find more stability after years of sharp declines”.