Silver prices ease after record highs, still up 175% in 2025

Silver slips 2% to ₹235,873/kg after profit-taking but remains 175% higher in 2025, fueled by supply deficits, Fed cuts, and strong industrial demand

Silver prices, which have surged to historic levels this year, witnessed a sharp correction in Monday’s trade but remain one of the strongest performing assets of 2025. Spot prices in India slipped nearly 2% to around ₹235,873 per kilogram after profit-taking, following an intraday fall of over ₹21,000 per kg, or 8%.

Despite the pullback, silver has delivered extraordinary returns in the domestic market. Since January, the metal has gained ₹1,52,554 per kg, translating to nearly 175% growth. This performance has outpaced gold, which has risen more than 80% during the same period, cementing silver’s position as the standout asset class of the year.

Drivers behind the rally

Structural Deficit: Silver’s supply dynamics remain tight. As a by-product of mining other metals like copper, lead, and zinc, its production does not automatically rise with demand. For seven consecutive years, the market has faced a supply shortfall, reinforcing the bullish trend.

Global monetary policy and geopolitics: The US Federal Reserve’s rate cuts in 2025, coupled with expectations of further easing in 2026, have boosted investor appetite for non-yielding assets such as silver. Additionally, geopolitical tensions — including tariff measures under President Donald Trump and the prolonged Russia–Ukraine conflict — have driven safe-haven inflows into precious metals.

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Industrial and investment demand: Silver’s unique role in modern industries has amplified demand. The metal is critical for solar panels, electric vehicles, electronics, and renewable energy technologies. With rapid adoption of clean energy and expansion in global electronics manufacturing, industrial consumption surged this year, adding momentum to investment demand.

Outlook

While short-term volatility persists, analysts highlight that silver’s long-term fundamentals remain strong. The combination of structural supply deficits, supportive monetary conditions, and robust industrial usage suggests that silver could continue to shine as a preferred asset in 2026, even as investors brace for further fluctuations.

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