New Delhi, Sep 7 (IANS): The momentum in silver is likely to continue, and could add another 15 per cent over the next few quarters, says a report by Motilal Oswal Financial Services.

After experiencing significant gains in the first four months of 2023, silver encountered some volatility at higher price levels. After every major dip domestic silver prices have been seeing a range shift on the higher side and this trend is expected to continue, the report said.

MOFSL advises continuous accumulation at lower levels with immediate support at Rs 70,500, while strong medium-term support is at Rs 68,000. On the higher side MOFSL could see prices targeting Rs 82,000 followed by Rs 85,000 over the next 12 months.

Moreover, the market balance indicates that this could mark the third consecutive year of silver operating in a deficit.

In early 2023, silver had a strong performance, gaining approximately 11 per cent in the first four months and maintaining a 6 per cent overall gain.

The initial rally was driven by concerns in the US banking and debt sectors, but this momentum was somewhat tempered by the Federal Reserve's "Hawkish Pause" policy, impacting both precious and industrial metals.

With the US Consumer Price Index (CPI) at 3.2 per cent, down from its peak of 9.1 per cent in July 2022, central banks are reevaluating their policies, potentially leading to a shift in the Fed's stance from tightening to easing, which could benefit metals like silver, the report said.

Geopolitical tensions are contributing to a risk premium, supporting silver prices. Additionally, the Dollar Index rebounded sharply from around 99.60 to 104. The Fed's raised growth forecast for the US in 2023, signalling a soft landing, is favourable for industrial metals and silver alike.

Data from the Silver Institute suggests that the market balance could remain in deficit for the third consecutive year, further supporting silver prices. Positive signals from China regarding economic growth and industrial demand are potential catalysts for silver's performance, the report said.

Lastly, the demand for silver in green technologies such as solar energy, electric vehicles (EVs), and 5G technology continues to paint a promising outlook for the silver market.