Silver settled 2.57% higher at Rs 242349, buoyed by a decline in US Treasury yields and a stabilisation in oil prices, which alleviated fears of renewed inflation and aggressive monetary tightening. Fed Governor Christopher Waller indicated that he would support holding rates at current levels if inflation continues moving toward the 2% target, prompting markets to reduce expectations for a near-term rate hike. The likelihood of a Federal Reserve interest rate increase this month has decreased to approximately 50%, down from nearly 70% earlier in the week. US trade data indicated that the deficit expanded to $88.6 billion in July, up from $71.1 billion in June. Exports experienced a decline of 2.1%, totalling $310.7 billion, primarily driven by reduced sales of crude oil and nonmonetary gold. Weekly unemployment claims rose slightly to 206,000, continuing to hover near historically low levels.
At the end of July, London silver vault holdings reached 28,213 tonnes, reflecting a month-on-month increase of 0.5%. This quantity is valued at $52.7 billion, which corresponds to approximately 940,423 silver bars. The silver market is anticipated to experience its sixth consecutive year of structural deficit, having seen 762 million ounces withdrawn from stocks since 2021. The 2026 deficit is anticipated to expand to 46.3 million ounces, up from 40.3 million in 2025, even with a 2% reduction in overall demand. Industrial fabrication is projected to decline by 3%, whereas demand for coins and bars is anticipated to increase by 18%. Total supply is anticipated to decrease by 2%, thereby sustaining the existing tightness in the market. Silver is currently experiencing short covering, evidenced by a 4.36% decline in open interest to 12,237, alongside a price increase of Rs 6,083. This suggests a reduction in bearish positioning and a strengthening of near-term momentum. Silver is maintaining its position above immediate support at Rs 238775, and a sustained trade above this level could preserve the positive bias. A decline beneath Rs 238775 could initiate a retracement toward Rs 235200.
On the upside, resistance is positioned at Rs 244350, and a decisive breakout above this level could extend the rally toward Rs 246350.Silver settled 2.57% higher at Rs 242349, buoyed by a decline in US Treasury yields and a stabilisation in oil prices, which alleviated fears of renewed inflation and aggressive monetary tightening. Fed Governor Christopher Waller indicated that he would support holding rates at current levels if inflation continues moving toward the 2% target, prompting markets to reduce expectations for a near-term rate hike. The likelihood of a Federal Reserve interest rate increase this month has decreased to approximately 50%, down from nearly 70% earlier in the week. US trade data indicated that the deficit expanded to $88.6 billion in July, up from $71.1 billion in June. Exports experienced a decline of 2.1%, totalling $310.7 billion, primarily driven by reduced sales of crude oil and nonmonetary gold. Weekly unemployment claims rose slightly to 206,000, continuing to hover near historically low levels. Meanwhile, London silver vault holdings reached 28,213 tonnes at the end of July, reflecting a month-on-month increase of 0.5% and valued at $52.7 billion, which corresponds to approximately 940,423 silver bars.
The silver market is anticipated to experience a sixth consecutive year of structural deficit, with 762 million ounces extracted from inventories since 2021. The 2026 deficit is anticipated to expand to 46.3 million ounces, up from 40.3 million in 2025, even with a 2% reduction in overall demand. Industrial fabrication is projected to decline by 3%, whereas demand for coins and bars is anticipated to increase by 18%. Total supply is anticipated to decrease by 2%, thereby sustaining the existing tightness in the market. Silver is currently experiencing short covering, evidenced by a 4.36% decline in open interest to 12,237, alongside a price increase of Rs 6,083. This suggests a reduction in bearish positioning and a strengthening of near-term momentum. Silver is maintaining its position above the immediate support level at Rs 238775. A sustained trade above this threshold could uphold the positive bias. A break below Rs 238775 may trigger a correction toward Rs 235200. On the upside, resistance is positioned at Rs 244350, and a decisive breakout above this level could extend the rally toward Rs 246350.
