Silver prices experienced a significant increase, closing up by 3.77% at Rs 3,99,893, following a breach of the important psychological threshold of $120 per ounce for the first time. The decision was propelled by significant purchasing activity and solid investment interest, as President Donald Trump indicated a willingness to accept a depreciated U.S. dollar, notwithstanding the resurgence of tariff threats and critiques regarding the autonomy of the Federal Reserve. This position drove the dollar to four-year lows, thereby increasing the attractiveness of precious metals.
The Federal Reserve maintained interest rates as anticipated, highlighting robust economic activity and initial indications of stabilization in the labor market, although persistent inflation and geopolitical uncertainties remain factors that obscure the economic outlook. Geopolitical risks are heightened in light of U.S. alerts regarding potential military engagement with Iran.
Concurrently, fiscal apprehensions, persistent ETF inflows, and continued acquisitions by central banks have provided additional support for prices. Concerns on the supply side have further bolstered the situation, as China’s newly implemented licensing regime restricts the number of exporters, thereby heightening apprehensions regarding the potential for reduced global availability. Chinese inventories have reached their lowest levels in a decade, accompanied by substantial shipments dispatched to London to alleviate domestic shortages. The outlook continues to be optimistic, as Citi has increased its 0–3 month silver forecast to $150 per ounce.
From a technical perspective, the market is experiencing short covering, evidenced by a 6.32% decline in open interest alongside a price increase of Rs 14,527. Support is identified at Rs 3,63,240, beneath which prices may approach Rs 3,26,595, while resistance is positioned at Rs 4,28,290; a breakout could pave the way toward Rs 4,56,695.