Spot silver will average $19 per ounce this year, a 20.1-percent decline on the 2013 average, GFMS Thomson Reuters’ Andrew Leyland said in the group’s interim silver market review
The metal was last at $16.21/16.26 per ounce, up 11 cents on Tuesday’s closing level. It peaked at $22.18 in February while it hit this year’s low of $15.06 earlier in November.
Leyland attributed the decline to falling physical demand, which it sees down 6.7 percent this year after a weak first half for many sectors.
In Europe, a harmonisation of sales tax rates in January 2014 made silver significantly more expensive for retail investors and led to lower sales until the recent price declines.
Elsewhere, there were modest declines in industrial usage, down 1.8 percent, jewellery, down -4.4 percent, and silverware, down -6.3 percent – thrifting away from silver continues in electronics and some retailers pushed gold jewellery products this year to take advantage of lower prices, GFMS Thomson Reuters said.
Still, demand for silver bars and coins has soared in recent weeks after bargain-hunting retail investors returned to the silver market, it added.
Indian imports of silver are up by 14 percent in January-October on the same period of last year and set for an annual record. With imports in the first 10 months totalling a massive 169 million ounces, many vaults in the UK, traditionally the largest supplier to India, have seen significant drawdowns, leading to more supply flowing from China and Russia, Leyland said.
(Editing by Mark Shaw)
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