Silver prices increased by 1.26% to Rs 1,47,321, bolstered by a global risk-off sentiment that enhanced safe-haven demand, despite a stronger dollar limiting gains. The significant drop in global equities, driven by concerns regarding inflated valuations and ambiguity surrounding forthcoming U.S. interest rate reductions, prompted investors to shift their focus toward defensive assets such as silver.
The likelihood of a December Fed rate cut has decreased to 69%, a decline from the previous 90% prior to last week’s FOMC meeting. Meanwhile, liquidity conditions in the London silver market have shown improvement following substantial shipments from the U.S. and China, which alleviated the recent physical shortage that had briefly caused London spot prices to exceed U.S. Comex futures. As per reports, at the conclusion of September, vaults in London contained 24,581 tonnes of silver valued at $36.5 billion.
Investment demand continues to be a significant factor, as silver ETPs experienced net inflows of 95 million ounces in the first half of 2025. This surge has elevated global holdings to 1.13 billion ounces, which is merely 7% shy of the record levels observed in early 2021. Retail investment demand exhibited resilience, especially in India, where it increased by 7% compared to the previous year.
The Silver Institute anticipates a 21% reduction in the global silver deficit, bringing it to 117.6 million ounces this year, attributed to a modest increase in supply alongside a decrease in demand. Short covering was evident as open interest declined by 2.98% to 20,245, while prices increased by Rs 1,837. Support levels are identified at Rs 1,46,060 and Rs 1,44,805, whereas resistance levels are observed at Rs 1,48,010 and Rs 1,48,705.