Silver has surged past $55 as global supply tightens, Chinese inventories plunge, and industrial demand rises. India’s imports are soaring, while a weaker rupee lifts domestic prices. Expectations of a December U.S. Fed rate cut and silver’s designation as a critical mineral further strengthen investor sentiment and long-term demand.
Silver prices on MCX have been in a strong uptrend for the past few years, but the metal has really been making headlines lately thanks to growing tightness in physical markets and renewed optimism over a potential US Federal Reserve rate cut in December. What began as a seasonal spike in demand during India’s Diwali period has now extended to China, where supply concerns are also mounting. Globally, silver surged to a fresh all-time high above $ 55 per ounce on Friday, while MCX prices briefly topped 168,000 after CME Group resumed trading following a major data center outage. The strong investor appetite has helped prices quickly reclaim and surpass the 50-dollar mark after a brief correction to around 45.55 dollars in late October, reinforcing the strength of the current bullish trend.
| Silver Performance on MCX | |
| Week to Date | 5.39% |
| Month to Date | 9.95% |
| Year to Date | 86.24% |
Chinese silver inventories have dropped significantly in recent weeks, with stockpiles in warehouses linked to the Shanghai Futures Exchange now sitting at their lowest levels since 2015. This steep decline in available metal is raising fresh supply concerns in the world’s largest manufacturing hub.
A surge in Diwali related buying in India and worries over U.S. tariff policies triggered a supply squeeze in London. Traders in Shanghai and New York rerouted physical silver to London to capture higher premiums.
As shipments shifted to London, inventories at warehouses linked to the Shanghai Futures Exchange dropped to their lowest levels since 2015. London stocks reportedly surged by about 54 million troy ounces in October alone.
China exported more than 660 tons of silver in October, the highest monthly volume ever, further tightening domestic supply.
Silver consumption in photovoltaic (solar) installations has been elevated during the peak Q4 installation season. A recent shift in tax treatment of gold also encouraged some retailers and manufacturers to pivot toward silver, adding more pressure on available stock.
Confidence is growing in a potential rate cut by the Federal Reserve in December, which has added fresh fuel to investor interest in silver. Christopher Waller and Mary Daly have both publicly signalled support for a December reduction, citing a weakening labor market and a diminishing risk of an inflation breakout. With futures markets pricing in roughly a 70 percent chance of a cut at the December 9–10 meeting, markets are increasingly tilting toward easier monetary policy — a backdrop that typically raises the appeal of precious metals like silver as investors seek assets that hedge against currency and rate-driven uncertainty.
Imports jumped from 119 million dollars in March 2025 to 1.3 billion dollars in September and 2.7 billion dollars in October. Festive-season buying, strong underlying demand, aggressive stocking by bullion dealers, and rising ETF inflows are major contributors to this surge.
The rupee has weakened from around 85.6 per dollar in January to almost 89.5, with most of the decline occurring after mid October. Since silver is an import dependent commodity, this currency depreciation adds additional upward pressure to domestic prices.
Despite higher inflows into London vaults, borrowing costs remain elevated — signaling that physical metal availability is still constrained.
The U.S. Geological Survey recently added silver to its critical minerals list. This shift could drive strategic stockpiling, policy changes, and stronger industrial usage, all supportive of a tighter global supply outlook.
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