The climate for precious metals isimproving with prices benefiting from renewed inflation fears
and the switching of funds from dollar and stock markets,
brokers Samuel Montagu and Co Ltd said.
    Silver prices in March gained some 15 pct in dlr terms due
to a weak dollar and silver is felt to be fairly cheap relative
to gold, Montagu said in its monthly silver newsletter. In
March the gold/silver ratio narrowed from 74 to less than 67.
    The supply/demand position has improved in the past year,
and despite a silver market surplus, the quantity of silver is
modest enough to be absorbed by investors, it added.
    The report said the firmness in oil prices was likely to
continue in the short term.
    A period of consolidation might be necessary before prices
attempted to move significantly higher,it said, but so long as
the dollar remains under pressure then the outlook for silver
was positive.
    However silver was less likely to continue to outpace the
other metals by such a margin, Montagu said.
 REUTER
