Demand for Solar Panels will Skyrocket this Year

Flexible US monetary policy, the dollar’s weakness, and, above all, the increase in demand for silver from the photovoltaic solar energy industry, will trigger the price of this metal in 2021.

A recent report by Saxo Bank on the future outlook for silver estimates that the price of this precious metal of abundant industrial use could rise during the next year to close to 50 dollars an ounce. It is a level the metal has not reached since 2011.

The report argues that the US dollar will continue to weaken even as the pandemic begins to subside due to the new vaccines’ deployment, starting this year.

However, the vaccine won’t act as an immediate remedy for the economic crisis derived from the pandemic. The consequences of the tremendous increase in debt won’t subside yet.

Inflation will continue to grow during 2021

In reality, the very remedy for the situation caused by the Covid-19 pandemic can become a disease in itself. These measures adopted by governments and central banks will become so addictive. It will become impossible to withdraw them without a more serious problem in the economy than the disease caused.

In this scenario, Saxo Bank believes that inflation will continue to grow during 2021. Governments and central banks will not adopt measures to contain them. Particularly, since their primary concern is to offer their maximum support to their economies’ recovery.

All of this makes up a bullish scenario for gold and silver. In the latter case, its situation will be further benefited by the increase in demand derived from the impulse of the applications related to the so-called ‘green transformation.’ Especially by the photovoltaic cells used in the production of solar panels.

Demand will grow so much that it exceeds the supply of precious metal. It will leave the silver market in a supply deficit.