Silver prices are unstoppable, with spot prices breaking through the key $60 per ounce level for the first time and setting a new record. Although the long-term upward trend remains intact, a return to more “normal” market dynamics could trigger sharp short-term volatility.

Silver has not only set a new all-time high, but its performance has also continued to significantly outperform gold. The latest rally in silver has pushed the gold–silver ratio down to 69, the lowest level since the end of July 2021.

Although interest rates remain elevated, they are below the spike seen in October. Since the surge at the beginning of October, market dynamics have shifted: demand in India has cooled after festival-related purchasing, and inventories in London have been replenished.

Since the end of August, silver’s unprecedented upward momentum has been driven by a combination of factors: global supply chain issues, strong industrial demand, and a renewed wave of investor interest.

Supply chain problems have eased somewhat, but overall market uncertainty has not completely disappeared. Inventories in London Bullion Market Association (LBMA) vaults have increased, while stockpiles in China have declined. High inventory levels in U.S. vaults have also edged lower, adding some liquidity to the global market.

In the short term, flows of investment capital into ETPs will drive the silver market; these products are now seeing their largest inflows since 2020.

Although silver still has room to rise relative to gold, the gold–silver ratio is starting to look somewhat oversold. While the ratio remains above the long-term average level of 65, its current reading clearly highlights silver’s recent outperformance and suggests that silver may be facing the risk of a short-term pullback.

Market Commentary:

On the weekly chart, silver continues to post fresh highs, with MACD lines and histogram expanding further above the zero line. Investors remain constructive on silver prices and expect them to stay volatile, particularly as the market focuses on key mining reports, which could further intensify tightness in certain regional markets.