Silver, which has been shining extremely brightly in the last few months, scaled $80 an ounce for the first time on Monday, before it saw some correction after profit booking. The precious metal beaten many other assets this year, including equities and gold, amid a relentless rise in demand as a safe haven asset as well as for its industrial use cases.
At the beginning of 2025, silver was trading at around $29 an ounce. On Monday, it hit an all-time high of $83.62, a 188 per cent surge in just one year. In the domestic market, silver, which was trading closer to Rs 93,500 per kilo at the start of the year has jumped over 170 per cent topping Rs 1.5 lakh per kg, before some pullback.
The surge follows a rally across precious metals including gold and platinum this year as geopolitical tensions and trade and tariff related uncertainties have driven a strong investor demand for safe haven assets. Gold also gained more than 70 per cent in 2025, significantly outperforming equities, but well behind silver.
Apart from safe haven demand, importantly silver also has lot of industrial use cases, accounting for over half of silver demand. Silver is seeing growing demand from solar panels to electric vehicles to 5G. It is also majorly used in areas like semiconductors and data centres, given its excellent electrical and thermal conductivity.
While demand has increased, supply of the metal hasn’t kept pace. According to The Silver Institute, while total demand has gone up around 24 per cent from around 929 million ounces in 2020 to an estimated 1.14 billion ounces in 2025, total supply has gone from 974 million ounces to 1.03 billion, a 6 per cent increase in the same period.
“Silver supply remains inelastic amid rising prices as majority of mined silver is produced as a by-product of lead, zinc, and copper mining. 2025 marks the fifth consecutive year where global silver supply lagged demand leading to market deficit,” said analysts at Axis Mutual Fund.
There were also reports recently of China possibly announcing restrictions on silver exports in 2026, which has buoyed sentiments in favour of silver prices continuing to gain. Silver exchange traded funds (ETFs) have seen strong inflows, driving up demand over the past year.
Will silver surge ahead in 2026 and top $100 or will investors see more profit booking opportunity and the rally then cools?
The All India Gem and Jewellery Domestic Council (GJC) believes the uncertain global environment, expectations of rate cuts, dollar weakness, central bank buying of gold, and industrial demand for silver will continue to drive both metals into a strong bullish trend.
Jigar Trivedi senior research analyst at Reliance Securities believes conditions could push silver to $100 an ounce on the Comex in 2026.
“Structural tightness on the physical market could support much higher prices if supply deficits deepen. Silver is crucial in solar panels, EVs, 5G, AI, electronics and other clean-tech infrastructure. As these sectors grow, industrial demand may outpace supply further – tightening markets,” he said.
However, analysts also warn caution. The Axis MF analysts say the outlook for silver remains constructive with multiple tailwinds, but 2026 may bring corrections and volatility as investors reassess valuations.
“Overvaluation leading to any weakness in physical demand, potential ETF outflows, profit taking could weigh on the prices. Additionally, stronger US dollar, rising real yields, easing geopolitical tensions, any downturn in copper prices and rotation into energy or agricultural commodities could also lead to downward pressure,” said the Axis MF analysts.
If we were to look back at history, there have been several examples where major rallies were followed by a crash. In 1980, for instance, silver price surged to around $40, but then crashed back to $10. Later in 2011, silver touched $50 an ounce, but that rally too didn’t last and it was only in 2025, a full 14 years later that silver crossed that level again.