Silver prices experienced a significant increase, with the market closing up by 7.59% at Rs 300238. This movement was bolstered by robust investment demand, expectations of tighter global supply, and India’s decision to substantially elevate import duties on precious metals. India has raised the effective import tariff on silver to 15%, up from 6%, by implementing a 10% basic customs duty in conjunction with a 5% Agriculture Infrastructure and Development Cess. The initiative seeks to curtail foreign acquisitions and alleviate strain on the nation’s foreign exchange reserves; however, it has also sparked significant domestic price increases.
Global market sentiment continued to be bolstered by ongoing geopolitical tensions and heightened inflation risks. US inflation surged to 3.8%, marking the highest level since March 2023, while core inflation also surpassed projections at 2.8%, dampening prospects for imminent Federal Reserve rate reductions. Energy prices have persisted at high levels due to the ongoing conflict in Iran and the sustained disruptions in the Strait of Hormuz. US President Donald Trump characterized the ceasefire situation as “on life support,” which has subsequently enhanced safe-haven sentiment in the precious metals market.
The fundamentals for silver continue to show promise, with the Silver Institute forecasting a structural deficit in the global silver market for the sixth consecutive year. Investment demand for physical silver is projected to increase by nearly 20% this year, bolstered by a strengthening investor appetite and sustained industrial demand from the solar, electric vehicle, and electronics sectors. In March, China’s silver imports reached an unprecedented level of approximately 836 metric tons, propelled by robust retail investment demand and proactive stockpiling efforts by photovoltaic manufacturers.
From a technical perspective, the market is experiencing renewed buying activity, evidenced by a 2.52% increase in open interest, which has settled at 7892, alongside a price surge of Rs 21176. Silver is currently finding support at Rs 292010, with additional downside support at Rs 283785. On the upside, resistance appears to be at Rs 306675, and a breach of this level could propel prices toward Rs 313115.