Analysts attributed the gains to fresh positions built up by market participants, reflecting renewed investor interest.
Overseas, Comex silver futures surged 3.77% to $90.44 per ounce.
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Global supply tightness and market fundamentals
According to Geojit Investments, silver spot prices stabilised after pulling back from their late-January record highs. The metal had briefly crossed $100 per ounce earlier this year, following a strong 146% return in 2025. The gold–silver ratio, an indicator of relative value, slipped to around 58.83, after dipping below 50 in January—the lowest level since 2012.
Global silver demand is expected to remain stable in 2026, driven by strong retail investment, while declines are projected in jewelry, silverware, and industrial consumption. Industrial fabrication is forecasted to fall 2% to a four-year low of 650 million ounces, partly due to reduced silver use in photovoltaics. At the same time, structural growth sectors such as AI-related technologies, data centers, and the automotive industry continue to underpin demand.
On the supply side, global silver production is expected to increase 1.5% to a decade-high of 1.05 billion ounces in 2026, supported by mine output, by-product from gold production, and a 7% rise in recycling. Despite this, the market is projected to face a sixth consecutive yearly deficit of around 67 million ounces, putting pressure on physical inventories.
Strategic importance and policy developments
Silver’s strategic importance is growing globally. China added silver to its rare earth minerals list, enforcing export restrictions from January 2026, while the US Geological Survey included silver in its 2025 Critical Minerals List. These developments are further tightening the global supply, reinforcing bullion’s safe-haven appeal.
Technical outlook
Analysts suggest that silver is likely to trade in a range-bound pattern in the short term, with medium- and long-term prospects remaining positive. On MCX, support levels are seen at ₹2.55 lakh per kg, with resistance around ₹2.91 lakh per kg. Any decisive move below support could signal short-term weakness, while broader fundamentals continue to support prices over the year.
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