Silver rose roughly 20% during August to touch $70 an ounce on August 21, up from about $57.59 at the end of July, after the US Treasury decided to double its long bond buybacks. The move carried the metal past several banks' full year average forecasts while leaving it short of the more aggressive year end targets on Wall Street.
Mining equities moved further than the metal. Hecla Mining, the largest US silver producer, gained 47% for the month, more than twice silver's advance. Wheaton Precious Metals rose 44%. Coeur Mining, First Majestic Silver, and Fortuna Mining each added 42%, and Silvercorp Metals gained 36%. The Global X Silver Miners ETF rose 35% and the ETFMG Prime Junior Silver Miners ETF, weighted toward smaller developers, added 32%. Pan American Silver, the largest primary silver producer in the world, gained 22%, the smallest move in the group and still ahead of the metal.
Bank forecasts remain widely dispersed. Year end and peak calls range from about $67 to $118 an ounce. UBS targets $80 at year end. J.P. Morgan sees an $85 fourth quarter high and flags downside risk to $50. Goldman Sachs forecasts a full year average range of $85 to $100, while Citigroup targets $110 for the second half. On the conservative side, ING forecasts $74 for the fourth quarter, HSBC sees a $75 full year average, and Commerzbank holds a $67 year end target.
The same amplification that lifted miners during the rally would magnify declines if bullion reverses, a point analysts raised as the metal cleared consensus baselines.
Source: MINING.COM - https://www.mining.com/silver-price-20-august-surge-sends-miners-soaring/