Silver prices concluded the session with a 0.24% increase, reaching Rs 2,39,888. This uptick was bolstered by low-level buying following recent market pressure. However, the potential for further gains was constrained by the hawkish indications from Federal Reserve officials concerning ongoing inflation risks. Chicago Fed President Austan Goolsbee indicated that robust demand could be a factor in inflation, in conjunction with rising energy prices, tariffs, and supply disruptions. Meanwhile, Minneapolis Fed President Neel Kashkari emphasised that high inflation remains a significant policy issue.
The CME FedWatch Tool suggests a nearly 90% likelihood of at least one US interest rate increase this year, positioning monetary policy expectations as a significant factor impacting precious metals. Meanwhile, investors are closely observing the dialogues between US and Gulf leaders at the United Nations General Assembly concerning possible strategies to augment oil supplies from the Middle East. As of the end of July 2026, silver holdings in London vaults amounted to 28,213 tonnes, reflecting a month-on-month increase of 0.5%. This total is valued at $52.7 billion and corresponds to roughly 940,423 silver bars.
The Silver Institute and Metals Focus anticipate that the silver market will experience its sixth consecutive structural deficit, with 762 million troy ounces extracted from inventories since 2021, thereby heightening the likelihood of renewed liquidity constraints. The global silver deficit is anticipated to expand to 46.3 million ounces in 2026, up from 40.3 million ounces in 2025, even as total demand experiences a decline of 2%. Industrial fabrication is projected to decline by 3%, reaching a four-year low, whereas demand for coins and bars is anticipated to increase by 18%, bolstered by robust purchasing activity in the United States. Total supply is anticipated to decrease by 2% as producer hedging returns to its typical levels.
Technically, the market continues to experience new buying activity, as evidenced by a 2.48% increase in open interest to 13,006 contracts, coupled with a price rise of Rs 571. Silver is currently encountering support at Rs 2,36,880. A sustained breach below this threshold may lead to a test of Rs 2,33,865. On the upside, resistance is positioned at Rs 2,41,720, and a decisive move above this level could propel prices toward Rs 2,43,545.
