-
Price up 11% in 2025 already: Why you should bet on silver for 12-18 months
Thu Mar 06 2025
The year 2025 presents a promising outlook for silver, a precious metal whose performance has been on a steady upward trajectory. Silver prices, in rupee terms, have already risen by 15 per cent in calendar year ( CY) 2024, and as of year to date ( YTD) 2025, they have surged by an additional 11 per cent. This rise has been largely driven by several macroeconomic and geopolitical factors, making silver an increasingly attractive investment for the foreseeable future, said Emkay Wealth Management, the wealth management arm of Emkay Global Financial Services in a report.
" Going ahead silver prices are expected to be well supported. The medium term as well as long term factors indicate a positive outlook for silver. The US interest rates are expected to follow a downward trajectory for 2025, albeit at a gradual pace. Over the near to medium term interest rates are a critical determinant of demand for precious metals. The geopolitical situation is expected to remain fluid over the near term and the trade policies of Trump administration are expected to encourage safe haven demand," said Emkay Wealth in a release.
As US interest rates are expected to continue their downward trajectory through 2025, there will be an increasing shift towards safe-haven assets like silver. With uncertainty surrounding Trump administration policies and continued geopolitical tensions globally, the demand for silver as a store of value is anticipated to rise.Looking at the supply-demand dynamics, the supply of silver has been in deficit for the past four years. For CY24, silver supply is projected to be 1,004 million ounces, while demand is forecasted at 1,219 million ounces.
Notably, about 60% of this demand comes from industrial uses, particularly in the booming sectors of electronic devices, solar panels, and electric vehicles (EVs). As green energy technologies gain momentum and EV adoption increases, industrial demand for silver is expected to maintain its strength, ensuring sustained upward pressure on prices.
Technical Factors From a technical standpoint, silver is exhibiting higher momentum. The price is currently attempting to breach the crucial US$ 33 level. If silver successfully breaks this resistance, it could see further appreciation toward the US$ 36.60, US$ 38.70, and potentially the US$ 39.30 levels within the next 12 to 18 months. This represents a favorable investment opportunity for those with a medium-term investment horizon.
Another key technical factor to consider is the gold-silver ratio, which currently stands at approximately 90. This high ratio indicates that silver is relatively undervalued compared to gold. Historically, this ratio tends to revert to a long-term range of 50 to 70, implying that silver prices could strengthen significantly over the medium term.
That combination of strong industrial demand, a supportive geopolitical environment, and favorable technical indicators, silver is poised for potential growth.
Source: https://www.business-standard.com/