Silver experienced a notable increase of 2.65%, closing at Rs 250,937. This movement was influenced by a decline in the dollar index, which fell to a two-month low, coinciding with a robust recovery in the Japanese yen attributed to suspected intervention. Safe-haven demand continued to be bolstered by ongoing geopolitical tensions and strong inflation expectations, while the overall sentiment in commodities showed improvement due to currency weakness. On the macro front, the Federal Reserve maintained its benchmark rate at 3.50%–3.75%, yet the policy outcome indicated the highest level of dissent since 1992, highlighting internal divergence.
In March, U.S. inflation experienced an uptick, coinciding with robust economic indicators, thereby bolstering anticipations for an extended hiatus in interest rate reductions. However, market pricing shifted marginally, with the likelihood of at least one 25 basis point rate cut in 2026 increasing to over 15%. Other major central banks, including the ECB, BoE, and BoJ, have also opted to maintain the status quo, reflecting a coordinated global policy pause. Fundamentally, silver demand experienced robust momentum from China, with March imports soaring to a record 836 metric tonnes—almost three times the decade-average level.
The recent surge can be attributed to strong retail investment interest, as silver has become a more affordable substitute for gold, coupled with significant stockpiling by the photovoltaic industry in anticipation of forthcoming policy adjustments. Heightened domestic premiums in China have initiated global arbitrage flows, with Hong Kong serving as a pivotal transit hub. In the interim, London vault holdings experienced an increase of 1.6%, reaching a total of 27,487 tonnes, indicative of consistent inventory accumulation.
From a technical perspective, the market is experiencing short covering, evidenced by a significant decline in open interest of 8.18% to 6,994 contracts, alongside a price increase to Rs 6,481. Immediate support is identified at Rs 243,550, with additional downside potential toward Rs 236,165. Resistance is established at Rs 256,270, and a sustained breakout above this threshold could propel prices toward Rs 261,605.