Morgan Stanley’s predictions for the next two years
Source: Morgan Stanley
The third round of quantitative easing from the Fed, combined with the ECB’s unlimited bond purchase program has been good for gold prices, reinforcing Morgan Stanley’s long-held bullish view on the metal.
Silver could outperform gold on a relative price basis, as it has a cheaper entry point. While silver had been underperforming as investors steered to gold thanks to uncertainty over global macroeconomic policy, it started to rally when speculation over QE 3 emerged in September. This is a trend that will likely continue, as supply and demand fundamentals remain favorable. Production from mines has stalled since 2011, whereas demand for silver for electronics and jewelry is making up for the collapse in its use in photographic equipment, coins and medals.
