Silver yesterday concluded the trading session down by -0.78% at Rs 1,34,002, as profit-taking occurred in response to the Federal Reserve’s cautious outlook and the strengthening of the US dollar. Fed Chair Jerome Powell emphasized a data-driven strategy, cautioning that excessively aggressive rate reductions might result in an unfinished fight against inflation.
While certain Fed officials favored a more rapid easing should the labor market deteriorate, others promoted a stance of patience, resulting in a mixed outlook for policy expectations. On the fundamentals front, silver continues to be underpinned by constrained supply and strong industrial demand from the solar, electric vehicle, and electronics industries. Investment appetite remains robust, as evidenced by silver ETPs achieving net inflows of 95 Moz in the first half of 2025, already exceeding the total for the previous year.
Global ETP holdings currently amount to 1.13 Boz, reflecting a mere 7% decline from the peak observed in 2021, while valuations have reached unprecedented levels exceeding $40 billion. Retail investment trends exhibit regional disparities—Europe demonstrates a moderate recovery, whereas India recorded a 7% year-on-year increase, propelled by optimistic price forecasts. In the interim, the Silver Institute anticipates a reduction in the global deficit to 117.6 Moz by 2025, indicative of a modest decline in demand coupled with an increase in supply. Industrial demand is anticipated to remain close to record levels, whereas demand for jewellery and silverware may experience a decline. Investment in coins and bars is projected to increase by 7% this year following significant declines in 2024, particularly within Western markets.
From a technical perspective, silver is experiencing long liquidation, as evidenced by a decline in open interest of 2.62%, bringing it to 16,930. Support is established at Rs 1,33,390; a decline below this level could see prices testing Rs 1,32,770. Conversely, resistance is noted at Rs 1,35,015, with additional upside potential extending towards Rs 1,36,020.