Silver prices experienced a notable increase of 2.96%, reaching Rs 183,408, driven by constricting global supply and heightened anticipations of more substantial rate cuts by the US Federal Reserve, which positively influenced market sentiment. Investor appetite has further strengthened, as silver-backed ETFs have added nearly 200 tons, elevating total holdings to their highest level since 2022. A record shipment of silver into London last month alleviated a local market squeeze while concurrently constricting supplies in other regions. Inventories at the Shanghai Futures Exchange have reached their lowest levels in a decade, while volumes at the Shanghai Gold Exchange have declined to a nine-year low.
In October, Chinese exports surged to a remarkable 660 tons, leading to a rapid depletion of domestic stock and altering global supply dynamics. Soft The recent US labor market data has solidified expectations for a rate cut in the upcoming week, with market participants anticipating several further reductions in the following year. Political speculation contributed to market volatility, as investors considered the potential for Kevin Hassett to succeed Fed Chair Jerome Powell—an outcome that markets perceive as favorable for more aggressive monetary easing.
In light of the unprecedented inflow of 1,674 tons into London vaults, it is noteworthy that borrowing costs in the OTC market continue to exhibit historically high levels. US Comex stocks experienced a substantial outflow of 1,568 tons since early October, although inventories continue to be markedly elevated on a year-on-year basis in the context of uncertainty surrounding US tariffs.
From a technical perspective, silver is experiencing short covering, as evidenced by a 4.6% decline in open interest to 13,957. Immediate support is positioned at Rs 179,995, followed by Rs 176,580. Resistance is established at Rs 186,030, and a breakout above this threshold may facilitate a movement toward Rs 188,650.