Silver hits fresh record high of $83.62: What's driving surge?
What's the story
Silver prices have hit a new all-time high of $83.62 an ounce, marking a 15% increase in 2026 so far. The rise is attributed to a combination of tight supply, strong industrial demand, and favorable global macroeconomic conditions. According to Axis Securities analysts, the metal is well-supported by robust industrial consumption and improving investment flows.
Demand drivers
Industrial demand and India's solar push
The demand for silver from solar power, electric vehicles, electronics, and auto components has kept the metal in focus. This is especially true as countries speed up their energy-transition plans. India's push to expand solar capacity has further boosted domestic offtake, strengthening demand fundamentals. However, supply conditions remain tight with the global silver market in a structural deficit for five consecutive years.
Supply challenges
Supply constraints and global market conditions
The Silver Institute's data shows that demand for silver has outstripped supply for five years. About 70% of silver production is a by-product of other metals, making it hard for the industry to respond quickly to price hikes. Flat mine output, declining ore grades, and modest recycling flows have kept availability constrained. Inventories in key markets like London, China, and the US are also at multi-year lows.
Market influences
Policy developments and macroeconomic factors
China's tighter export controls on silver could further restrict global shipments from one of the world's largest producers. Analysts have warned that the existing global deficit could widen if export approvals become more restrictive. On a macro level, a softer US dollar and expectations of future US rate cuts have provided additional support to silver prices. Lower global yields tend to boost precious metals' appeal while currency movements can amplify price swings in India.
Market trends
Investment demand and future outlook
After a long period of ETF outflows, investment demand for silver has also strengthened. Axis Securities noted a turnaround in silver ETF flows with recent inflows offsetting earlier liquidation. Geopolitical uncertainty and high global debt levels have further bolstered investor interest. InCred Money and Tata Mutual Fund's outlook commentary suggests that silver could remain constructive over the medium to long term despite volatility.