Precious Metals Market Insights For 2023

The precious metals basket experienced a tumultuous 2022, with volatile price swings across gold, silver, platinum, and palladium. However, the LBMA’s winning forecasts by analysts for each metal was surprisingly close to the actual average price for the year. Bullion analyst Sanjiv Arole notes that looking ahead to 2023, analysts are predicting price increases for gold, silver, and platinum, while palladium is expected to see a further decline.

William Shakespeare’s play, “All’s Well That Ends Well”, perhaps aptly summarises the performance of the precious metals basket on the price front in 2022. In Shakespeare’s play there is much confusion, misunderstandings and utter chaos. But, in the end, all of it is sorted out and you have a happy ending – it all ends well.

It was a tumultuous 2022 for the precious metals basket. Let us analyse the price performance of each and every precious metal during the last year. The gold price vacillated quite a bit, in a 27% range between $2,067 per ounce (intra-day) and $1,628.75 per ounce, even veering towards $1,600 per ounce.

Silver was even more volatile as it swung wildly in a 47% range between $26.17 per ounce on the higher side and around $17.17 per ounce (intra-day) on the lower side, intra-day, the deviations was much more. The comeback kid on the block, platinum, was not as volatile as silver as it swung in a 38.5% range, going up to a high of $1,151 per ounce as well as a low of $831 per ounce.

Palladium bore the brunt of the Ukraine war as it first shot up like a ‘Sputnik’ to $3,447 per ounce (intra-day) and then as the bottom fell off, hurtled into an abyss in a free fall by a massive 105% to $1,675 per ounce. Suddenly (in F-1 parlance), from pole position, it was fighting to hold onto its place on the grid.

Not surprisingly, the LBMA forecasts by analysts in 2022 seemed off target. In gold, though the average gold price forecast was just a bit off target, with an average forecast of $1,801.9 per ounce against an actual average of $1,800.09 per in 2022. In silver, the average forecast was $23.54 per ounce against an actual average of $21.73 per ounce, a difference of 8.33%. In platinum, the difference between the average price forecast and the actual average price was just a shade over 10%. In palladium too, the difference was around 7%.

However, the winning forecast in all the precious metals sprung a few surprises. In spite of all the upheaval in the gold price during 2022, winning forecast of $1,800 per ounce was a mere 9 cents off the actual average price for gold in 2022. It was not much different in silver either, with the difference between the winning forecast of $21.78 per ounce being just 5 cents more than the actual average price for silver at $21.73 per ounce during 2022. The gap between the winning forecast prices of $970 per ounce was just less than $10 per ounce shy of the actual average price of $960.51 per ounce in 2022.

Lo and behold, in palladium too the difference the winning forecast of $2,110 per ounce was just $2 per ounce against the actual number of $2,112 per ounce. Therefore, on the price front, borrowing from Shakespeare, “All was well that ended well!” But, the palladium price that was at one point, around 3 times the platinum price and more than nearly $1,400 per ounce higher than gold, was left assuring itself (aka Amir Khan from the movie ‘3 Idiots’) that “All was well!”

So, what is in store for the precious metals basket in 2023?

After looking back at what transpired during 2022, it is now time for some crystal gazing and looking forward to the remainder of 2023. But, for that, the first pit stop is the Annual LBMA analysts’ price predictions for all the precious metals.

Let us look at the predictions made individually for each of the precious metals, one by one.

(a) The average gold price predicted by LBMA analysts was $1,859.90 per ounce, up by 3.3% over the 2022 average price of $1,800.09 per ounce, with a high predicted at $2,200 per ounce and a low of $1,445 per ounce. The highest average predicted was $2,025 per ounce and the lowest average was forecast at $1,594 per kg.

(b) Silver’s average price for 2023 was predicted around 8.8% higher at $23.65 per ounce as compared to the 2022 average price of $21.73 per ounce. The high for the year is predicted at $35 per ounce and the lowest for the year forecast is $14.70 per ounce. The highest average for the year is forecast at $27 per ounce and the lowest average predicted at $17.5 per ounce.

(c) Analysts are more optimistic about platinum as they have predicted a 12.5% rise in the average price of platinum for 2023 at $1,080.40 per ounce as compared to the 2022 average price of $960.51 per ounce. The high for the year is foreseen at $1,425 per ounce, while the low is seen at $830 per ounce. The average of the high price is project at $1,241 per ounce, while that for the low price is $988 per ounce.

(d) The precious metal that lost much ground during 2022 is predicted to decline even further. All the analysts are very pessimistic about the palladium price for 2023. They have predicted a steep fall of 14.3% over the 2022 average price of $2,112 per ounce to $1,809.8 per ounce in 2023. Even though the high for the year is seen at a healthy $2,800 per ounce, the low is seen down to $1,300 per ounce. This could trigger price volatility in palladium given the huge range of $1,500 per ounce during the year. The average of high price is more plausible at $2,180 per ounce and the average of low price is $1,550 per ounce.

Let us look at the performance of the precious metals prices in the three months and a bit during 2023 and analyse what the main drivers would be for each of the precious metal.


(a) Gold opened for the year 2023 at $1,835.05 per ounce and after a few ups and down declined to its lowest for the year so far at $1,809 per ounce on the 27th of February, 2023.  Thereafter, after the banking crisis reared its head with the fall of SVB, the yellow metal crossed the $2,000 per ounce mark several times in the last month or so with a high of $2,048 per ounce on the 13th of April, 2023. It has been vacillating quite frequently in a 13.2% range or $239 per ounce this year. Gold has already averaged $1,899.88 per ounce till April 12, 2023 (all gold prices London pm fix, However, intra-day, the price variation was much more with the yellow metal much above $2,049 per ounce as well as declining below $1,809 per ounce.

(b) The ongoing Ukraine war seems nowhere nearing its end. The never-ending war could only propel gold forward.

(c) The indication by Jerome Powell that prevailing market conditions could force the Fed to pause its regime of interest rate hikes, even if the target of 2% inflation is not met. This could give a big boost to gold.

(d) At the back of the mind would be growing fear that the banking crises could blow up into a full-blown financial meltdown like 2008, including a deep recession. In such a scenario, gold could lift off to the stratosphere.

(e) Gold could only benefit if US inflation remains much above the Fed target of 2%.

(f) Investors could flock to gold ETFs should the banking crises deepen. Even otherwise, gold ETFs have been in demand.

(g) The continued interest in gold purchases by Central Banks.

(h) The yellow metal price could fluctuate wildly depending on US economy data that could either boost the gold price or dampen it. Recently, the lower-than-expected US jobless claims saw the gold price nose-dive below $2,000 per ounce, but a pause or decline in interest rate hike could see the yellow metal skyrocket.

(i) Then, ‘dedollarisation’ (a new terminology) could impact the USD and only propel gold forward.


Silver traded in a 29.52% range with a high of $26.02 per ounce and a low of $20.09 per ounce ( London pm fix on 14th April, 2023 and 10th March, 2023, respectively). However, this range is well short of the predicted 138% for the year. So, greater price volatility for silver could be expected in the coming year.  As silver often acts as proxy for gold in its safe haven status, the white metal could scale fresh highs along with gold. However, as the white metal is also an industrial metal any hint of a recession could adversely impact silver’s performance in the year. In such a scenario, silver’s safe haven status and its precious metal usage in jewellery, silverware and as an investment option comes to the fore. In recent times, silver has made a comeback of sorts against gold as the gold: silver ratio that was hovering around 96 not so long ago is now below 80. So, from the gold price being nearly 96 times that of silver it is now around 80 times the silver price. Last year, silver imports into India were abnormally high over 10,000 tonnes. It is highly unlikely that those abnormal circumstances would be repeated again so easily.


This precious metal is in the midst of comeback both as an industrial as well as a precious metal. These days platinum jewellery is gaining in preference over gold jewellery as it is much cheaper than gold. Less than 20 years ago, platinum was the costliest precious metal and white gold was used in jewellery as a substitute for platinum. Now with the gold price almost double that of platinum, the shoe is in the other foot. Just last year, palladium was the costliest precious metal as it was three times the price of platinum and more than $1,400 per ounce dearer than gold. But, the high price coupled with sanctions, etc. due to the Ukraine war presented a golden opportunity for platinum. The process of substituting palladium with cheaper platinum for catalytic convertors in cars gained momentum. Moreover, with most of the palladium supplies emanating from Russia under a cloud, this process was further accelerated. In 2023, platinum is in a 20% range with a high of $1,100 per ounce and a low of $912 per ounce, this was against a projected range of over 71%.

Strangely, while platinum is half the gold price, its predicted high for the year by LBMA analysts at $1,425 per ounce is higher than the lowest price predicted for palladium at $1,330 per ounce. Will this result in palladium regaining its position as an auto catalyst in convertors would be interesting to observe. However, that could take some time as the current scenario over the Ukraine war is far from clear. How long the sanctions against Russia remain too is not clear. Any hint of recession could impact production of cars and that in turn could severely hamper use of platinum in catalytic convertors. It could kill the platinum story for quite some time.


It is a ‘rags to riches’ story for palladium. In the 1990s, palladium was the cheapest metal in the precious metals basket. Its peak then was around $160-170 per ounce. Only last year, palladium soared to its highest ever price of $3,447 per ounce (intra-day) on 7th March, 2022. The Ukraine war has adversely affected palladium supplies from Russia that accounts for around 30-40% of primary supply of palladium. The high price and low supplies of palladium into the global markets due to sanctions on Russia as well as closure of mines for maintenance accelerated the process of substitution of palladium with much cheaper platinum.

In the current year, the palladium price moved in a 34.46% range with a high of $1,830 per ounce and a low of $1,361 per ounce. This was against a whopping 115% projected by analysts. Palladium would depend more on the resolution of the Ukraine war, for resumption of full supplies from Russia. However, should recession descend on the global markets, then platinum, palladium as well as silver would be adversely impacted during the year. Only gold and to some extend silver would show a rise in the price in the wake of a recession.

Finally, should the SVB induced banking crises, that has caused central banks to ease liquidity, not escalate any further and instead dissipate quietly, then things would not remain rosy for gold, in particular. In such a scenario, the fed could continue with its strong-arm tactics against inflation by hiking interest rates. However, the odds are against any new regime of interest rate hikes. The banking crisis has been a reality check for decision markers. In the short term at least, $2,000 per ounce is here to stay.

An independent bullion analyst, Sanjiv Arole was previously a metals analyst at GFMS for over a decade. He was also a consultant to the World Gold Council.

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