Silver to Dip in Next 12 Months, Following Gold: Goldman Sachs

LONDON (July 29)  The Financial Post reported that Goldman Sachs says that silver prices will retreat slightly from its current price of $20.20/toz to $19.60/toz  over the next 12 months, tracking gold.

As quoted in the market report:

Over the long run, silver prices tend to track gold prices. Thus, our silver forecast reflects the historical ratio to gold.  

Mounting controversy and alleged market manipulation has led Washington legislators to take a stronger look at major banks’ hold over commodities, with the Fed to possibly reevaluate regulation in the coming months.

But for investors, the case for holding commodities as a strategic move is still clear, according to Goldman Sachs commodity strategist Jeffrey Currie.

Currie tells clients three reasons why: “1) commodities as a hedge against hostile markets amid rising geopolitical risks, 2) significant roll-yields on the back of the tightness in Cushing which will likely support backwardation in energy markets into the autumn, and 3) an increasing decline in correlations across returns, both within commodity markets and against other asset classes, making the case for commodities investments as a way to diversify portfolio risk.”