Markets in an uproar! Silver Rises Sharply, Physical Stocks Starting to Run Short
Silver prices continue to surge and are now trading near their highest level in 14 years. This increase is driven by investor demand seeking an alternative to gold, which has become overpriced. Spot silver prices rose 1.8% in Asian trading today, following a 4% weekly gain last week. Through 2025, silver has recorded a 35% increase, outpacing gold's 28% increase.
This high demand has also led to tighter physical silver supplies in London, especially since the metal is largely held in ETFs and unavailable for direct trading. Since February, the volume of silver-backed ETFs has increased by approximately 2,550 tons. The cost of borrowing silver for one month has also jumped by 6%, well above the normal level of almost zero.
Market analyst Priyanka Sachdeva of Phillip Nova said that investors are now turning to silver because gold has become too expensive for many buyers. "Silver is benefiting from the threat of a trade war and high bullion prices," she said. The current gold-to-silver price ratio is around 86:1, still higher than the 10-year average of 80.
Besides being a safe haven asset, silver is also widely used in industries such as solar panels, leading to increasing demand. The market is expected to experience a supply deficit for the fifth consecutive year, according to the Silver Institute. At 8:08 a.m. London time, silver was trading at $38.916 per ounce, while gold was at $3,367.13 per ounce.
Source: (ayu-newsmaker)
