The U.S. Mint usually sees a large influx of demand when it releases new coins in the starting of the year. This year, nevertheless, investors looking for a safe haven for their cash added to the usual enthusiast demand leaving the Mint's vaults bare.
"It is simple to infer that some element of the fear trade might be at play," Joni Teves, an analyst at UBS AG in London, wrote in an e-mailed report. "We view the chunky sales of American Eagle coins more a role of seasonality than something else. It's important to help keep an eye on U.S. coin sales in the coming months to determine if volumes stay elevated because the debt ceiling showdown plays out."
The news in the Mint coincides having a report that the iShares Silver Trust ETF (NYSE: SLV) saw the greatest inflows of any exchange-traded fund (ETF) this week, adding $600 million to its assets below management. IShares manager BlackRock (NYSE: BLK) confirmed that this was the biggest increase in the silver ETF's assets ever. Gold Coins, Silver Coins, Rare Coins Learn More >> http://www.silverdollar.cc/
Demand for silver as a protection comes amid elevated turmoil over the debt ceiling in the U.S., the ongoing crisis in Europe and an aggressive try to produce inflation in Japan.
Precious metals investors have also been disappointed by the overall performance of gold in current weeks and might be searching for an optional investment. Definitely the gold/silver ratio has been in a downfall since late December, falling from 56 to almost 53, a decline of about 5%. All these elements combine for investor sentiment that is bullish for silver prices.
Another significant purpose for greater silver prices will be the outlook for enhanced financial activity, especially in China, which reported better than anticipated quarterly gross domestic product (GDP) numbers recently.
"With silver, you are able to benefit from both sides: its safe haven status and also the reality that it is also an industrial commodity," Frederique Dubrion, the Geneva-based president and chief investing officer of Blue Star Advisors SA stated. "Given some positive top indicators, particularly in the U.S., investors would most likely favor turning to silver instead of to gold."
In that sense, silver features a more direct link to international industrial activity than gold. Because the international economy recovers, demand for silver will increase at a time when supplies are tight because of monetary demand from investors searching for a safe haven.
Silver is utilized in a number of automotive applications, and international automakers have forecast elevated demand for vehicles and light trucks in the world's significant marketplace, such as China and also the United States of America. This should supply some support in the demand for silver in 2013.
So, whether or not you're optimistic concerning the economy or pessimistic about how Congress will deal with the debt ceiling, given the metal's dual roles as each an industrial commodity as well as a store of worth, you should be betting on greater silver prices. Our fervent recommendation is to buy silver and hold for your asset protection. How High Will Silver Go? Learn More Kitco Silver >> http://silverdollar.cc