Poles are increasingly choosing to invest in silver

Customers prefer to buy coins with a small, ounce weight, i.e. the Australian Kangaroo, the Vienna Philharmonic or the Canadian Maple Leaf - this is the effect of the strengthening price of silver and the low price of a coin (approx. PLN 140). The coronavirus pandemic and the accompanying uncertainty in the markets, the subsequent geopolitical crisis and the inflation that has been going on for several months have made silver gain in value. The Treasury Mint sees further potential for an increase in the prices of products made of this metal.

The price of silver has gone up sharply over the years

The precious metals market is strongly correlated with the global economic situation. On a three-year basis silver price increased from USD 12 (March 2020) to USD 22 (February 2023) per ounce - an increase of as much as 83%. Although the record price of silver from 2011 (USD 48,5) is still far away, these are forecasts The Silver Institute indicate that this year we may face a shortage of silver on the market, which will probably translate into another increase in the price of this raw material. Precious metals were one of the main winners of the recovery from the pandemic economic crisis. In the second quarter of 2020, we observed the highest gold price per ounce, in excess of 2 Silver was then the most expensive in 7 years and cost USD 28 per ounce. Although almost 2 years have passed since that period, we can again talk about the "silver and golden times".

- Silver is a rare commodity and its supply is limited, so in case of subsequent increases inflation will still hold its value. The increase in the value of bullion on stock exchanges, including silver and gold, is mainly determined by the weakening of the dollar, which is used as the international metal trading currency. Also withdrawal of covid policy in  China will drive the market, because it is in that part of the world that silver products are extremely popular. Some analysts predict the potential for an increase in the price of silver at the end of this year to USD 25-30 per ounce. It seems that Poles also believe in it, because more and more customers buy from us products made of this metal, especially low-weight coins. They are attractive to buyers, mainly because of the price (approx. PLN 140), which means that everyone can afford such a purchase. What's more, they are easy to cash in on the market in every corner of the world. – points out Jarosław Żołędowski, President of the Treasury Mint.

Silver - not only as a capital investment

Silver is not only a valued investment metal, but also a desirable metal in many sectors of the economy. Experts estimate that the industry, due to its unique physical properties, consumes about 40% of the world's silver production. The largest producers of silver are: Mexico, Peru, China, Russia i Poland. Analyzes The Silver Institute and Metals Focus indicated in November that silver extraction in 2022 will increase globally by 1% y/y and will amount to approx. 830 million tonnes at the end of 2022 - although official data is still pending, it is already possible to determine in which sectors silver is most often used. For years, this metal has been processed, e.g. in jewelry, electronics and medicine. Recently, it has also played an important role in technological solutions and electric motorization  and energy and  photovoltaics. The increasing demand for silver in the industry causes its price on global markets to fluctuate with the growing demand.

Investing in silver may be attractive to investors who are looking for a way to diversify their investment portfolio in 2023 and hedge against inflation. When deciding to buy silver, it is worth remembering that since 2011, a 23% VAT tax has been in force in Poland. Previously, this raw material, like gold, was exempt from value added tax. Currently, in accordance with the regulations, investment silver is not treated as a currency, but as so-called "collector's item".

Author: Mint of Poland