Silver surges 166% year-to-date: Key trends to watch in 2026
What's the story
Silver has been on a remarkable run lately, outpacing even gold in terms of returns. The white metal's price on the Multi Commodity Exchange of India (MCX) surged by an astounding 166% this year, from ₹95,400 on December 31, 2024, to ₹2,54,100 as of December 29. On the spot market too, silver's price skyrocketed from just above $29 to approximately $83 during the same period.
Market dynamics
Silver's dual role drives price surge
Silver's unique position as both a monetary and industrial metal has been instrumental in its price surge. The US Federal Reserve's decision to lower interest rates, along with global uncertainties, have further propelled the white metal's value. Now, analysts are looking at key economic trends that could influence silver prices in 2026.
Future outlook
Economic trends to watch for silver's price in 2026
Renisha Chainani, Head of Research at Augmont, identifies three major economic trends that could transform silver from a cyclical asset to a strategic metal. These include the global energy transition (especially solar, EVs, and grid investments); slower global growth with easing monetary policy (which would lower real interest rates and support precious metals); and de-globalization/trade restrictions (like China's export controls).
Market shifts
Supply constraints and China's role in silver market
Navneet Damani, Head of Research (Commodities) at Motilal Oswal Financial Services Ltd., says silver's 2025 rally is driven by real metal scarcity rather than speculative positioning. He notes that physical deficits, policy-driven supply restrictions, and concentrated inventories are increasingly dictating prices. China, a major refiner and net importer of silver, has seen steady drawdowns in physical inventories throughout 2025. Proposed export licensing requirements starting January 1, 2026, could further tighten control over outbound flows.
Rate impact
Central banks' interest rate decisions and silver prices
Interest rates play a crucial role in silver's price as it is a non-yielding asset with high beta. If global central banks, especially the Fed, cut rates more than expected, real yields will remain compressed, boosting silver prices. Chainani believes central banks increasingly view precious metals as diversification tools amid currency debasement concerns. While gold benefits more directly from reserve buying, silver tends to outperform during easing cycles due to monetary support amplifying both its investment and industrial demand channels.
Market performance
Silver's performance in 2026 and global tensions
Chainani expects silver to outperform gold in percentage terms in 2026, albeit with higher volatility. Gold will remain a core hedge against debt, currency risk, and geopolitics—offering stability. Silver benefits from both monetary tailwinds and accelerating industrial demand from solar, electronics, and defense sectors. Damani believes the silver market has entered a structural phase driven by prolonged physical supply deficits, inventory depletion, and policy-led supply constraints.
Investor guidance
Price predictions and investment advice for silver in 2026
Chainani expects silver prices to range between $65 and $80 per ounce in 2026, with upside risks toward $95-$100 if deficits persist and monetary easing accelerates. He advises investors to avoid chasing short-term spikes and adopt a staggered investment approach combining SIP-style accumulation on dips with tactical allocations during corrections. Silver should be viewed as a medium- to long-term strategic asset, not a short-term trading instrument.