Silver prices experienced a notable increase, closing up by 4.89 percent at Rs 2,07,435, propelled by constricting global inventories, robust industrial demand, and its recent addition to the US critical minerals list. Strong ETF inflows and ongoing retail purchasing have bolstered bullish sentiment, enhancing expectations of a structural market deficit in the upcoming year. Industrial consumption of solar energy, electric vehicles, and data-center infrastructure is experiencing significant growth, whereas global mine production and recycling have largely stagnated for more than ten years. Concerns regarding supply have escalated following China’s announcement of stringent export controls on silver set to take effect in 2026, prompting a wave of aggressive pre-emptive purchasing.
Chinese stockpiles have declined to their lowest levels in almost a decade, with inventories at Shanghai Futures Exchange warehouses reaching their weakest point since 2015. A record export of over 660 tonnes from China in October provided a temporary alleviation of local tightness, yet it transferred pressure to global markets.
High lease rates and borrowing costs for physical silver in London suggest real delivery constraints instead of mere speculative positioning. In spite of a 3.5 percent month-on-month increase in London vault holdings, the overall liquidity in the market continues to be constrained.
From a technical perspective, silver is experiencing new buying activity, as evidenced by a 3.83 percent increase in open interest coupled with a significant price increase of Rs 9,680, suggesting a robust long build-up. Support is positioned at Rs 2,01,815, with additional downside at Rs 1,96,190. On the upside, resistance is observed at Rs 2,10,450, and a decisive break could pave the way toward Rs 2,13,460.