Investing.com – prices could see headwinds in the near term due to broader economic uncertainty, although the metal received support from global consumption outstripping supply, according to analysts at Bank of America .

A stronger US dollar and weak industrial activity have put pressure on silver recently, while President-elect Donald Trump plans to impose tough import tariffs on Canada and Mexico. – major suppliers of the metal to the US – threatens to dislocate silver markets, analysts said in a note to clients.

However, the price of silver has hovered around $30 an ounce for the past nine months. At 04:02 ET (09:02 GMT) on Thursday, silver traded up 0.5% at $30.81.

BofA analysts led by Michael Widmer argue that, in their view, this stability is tied to “persistent deficits in the silver market”, with “limited growth in mine production (…) a significant source of price support” in particular.

Global silver consumption outpaced metal production in 2022 and 2023, and is expected to do so again in 2024, research from BofA found.

They estimate that 37,083 tons of silver will be consumed this year, down 0.4% from the projected amount in 2024, while output is seen to increase by 3.5% to 33,021 tons. Despite the change, the silver market will remain in deficit — a trend BofA analysts expect to continue through 2026.

“(T)he silver market has been in deficit for a while and the deficits will eventually count,” the analysts wrote. They note that this support is mirrored in some regions, with silver “trading at a premium” in India and consumers in China having to “pay up to source ounces.”

As a result, analysts say silver has “strong fundamentals”, adding that it will “do better” than the metal.

“Silver won’t be gone for long,” they say.