It's been a stomach-churning period for the U.S. economy. During the first six months of 2008, the macroeconomic reasons that sent the stock market plunging into bear market territory pushed precious metals to new highs. But since then, gold, silver and platinum have experienced corrections ranging from 10% to 23%.

The question now: Have precious metals peaked or do they have room to rise?

Gold

The Bear Stearns bailout sent gold to an all-time intraday high of $1,033 an ounce in March. Since then, it's bounced in a trading range between $850 and $990. Trading as a commodity, gold underperformed oil and platinum for the first half. Two-thirds of gold's demand as a commodity comes from jewelry fabrication. That demand fell 55% during the first half.

"Demand was way down, but prices rose 15% for the first half of the year. That suggests the primary demand is investment demand," says Tom Winmill, portfolio manager at the Midas Fund (MIDSX). "Gold is acting as an alternative currency."

Gold can be used as a currency hedge, inflation hedge or portfolio diversifier. It's also considered a safe haven, because in times of economic and political uncertainty it continues to hold its value.

Rising inflation and a shaky financial system has put the Federal Reserve Bank in a precarious position. Central banks battle inflation by raising interest rates to tighten the money supply. However, to prevent any collapse in the financial system, the Fed needs interest rates low to keep markets liquid. This easy money fuels inflation, leaving the U.S. economy in a viscious circle and the Fed walking a tightrope.

Today‘s market, when people don't like the dollar and interest rates remain low, is bullish for gold.

Jeffrey Christian of the CPM Group, a precious metals research and consulting company in New York, says gold could take another dip to between $880 and $900 in August, but he expects the yellow metal to top its earlier high in the last quarter.

The Midas Fund's Winmill is even more optimistic. Jewelry demand typically picks up in the second half of the year as manufacturers prepare for the holiday season. If interest rates remain low and the dollar weak, he says gold could top $1,200 by year end.

Silver

In March, silver hit a 28-year intraday high of $21.35. It's since backed off to $17.57 as of Thursday's close. While silver trades relative to gold, it has different market issues. Silver has many more industrial uses than gold. For the first six months, silver faced strong demand from manufacturers of flat screen TVs, cell phones and computers. However, second-half demand is expected to weaken. A recession will impact silver harder than gold because fabrication demand will ease as consumers buy fewer electronics.

At the same time that demand may ease, silver's supply is increasing. New mines have come online recently, bringing a surplus of product to the market.

"That could weigh on the price of silver," says Joe Foster, portfolio manager of the Van Eck International Gold Fund (INIVX). "Meanwhile, the supply of gold is tighter due to declining gold production. However, I think silver will follow gold wherever it goes. If gold makes new highs, then silver will make new highs too. Silver is a much thinner and more volatile market. It takes a lot less demand to get the price moving higher."

Platinum

Unlike gold and silver, fundamental supply and demand drives platinum much more than the investment market. And for the past four years, there have been supply deficits.

Approximately 80% of the world's platinum comes from South Africa. For more than a year, electrical problems and rolling blackouts in South Africa have created supply disruptions. The mines are still not running at full capacity. Yet, as supply tightens, demand increases. This sparked the rally that pushed platinum to a high of $2,278 in March. Investor demand for the Platinum ETF in London also pushed the metal higher. But platinum is extremely volatile, and like gold and silver, it experienced a correction.

A large part of the platinum market goes into catalytic converters for cars. Signs of an economic slowdown in the U.S., including falling demand for cars, pushed platinum sharply lower in July. On Thursday, it closed at $1,744. Yet, even as U.S. auto demand falls, worldwide demand, especially in Asia, continues to rise.

"Demand is expected to be strong even though the U.S. is flirting with recession, because economic growth will still be positive globally," says David Jollie, publications manager at Johnson Matthey, a refiner and manufacturer of platinum products. "Platinum is used for computer hard discs and that demand is rising."

Jollie says it's difficult to tell where platinum will end the year because the commodity market looks weaker than six months ago. There is upside potential, but the signs aren't clear.