As rising bond yields and crude oil prices heightened fears about inflation and bolstered prospects of tighter monetary policy, silver fell precipitously by 1.95% to Rs 235,441. The U.S. dollar index regained positive momentum amid a global bond selloff, with rising sovereign borrowing costs across Europe adding further pressure on precious metals. Geopolitical tensions persisted as U.S. President Donald Trump issued a warning to strike Iran “hard” in the wake of renewed military exchanges. The U.S. targeted Iranian rocket launchers on Larak Island, while Iran responded with attacks on the UAE and Jordan.
Markets are currently concentrating on the U.S. August payrolls report scheduled for Friday, along with consumer price data set to be released on September 11, as they seek insights into the Federal Reserve’s interest-rate trajectory. Meanwhile, the European Central Bank is anticipated to implement a 25 basis points increase during its meeting on September 9–10. Despite the recent price weakness, speculative positioning remained supportive, with COMEX silver speculators increasing net long positions by 2,467 contracts to 13,235 contracts for the week ended August 25. London vault holdings reached 28,082 tonnes at the close of June 2026, reflecting a month-on-month increase of 1.7% and valued at roughly $53.1 billion, which corresponds to approximately 936,052 silver bars.
The global silver market is anticipated to continue experiencing a structural deficit for the sixth consecutive year, with projections indicating that the deficit will expand to 46.3 million ounces in 2026, up from 40.3 million ounces in 2025. However, total demand is projected to decrease by 2%, while industrial fabrication is expected to drop by 3%, reaching a four-year low. This decline may be partially counterbalanced by an 18% rise in demand for coins and bars. Total supply is anticipated to decrease by 2%.
Technically, the market is experiencing renewed selling pressure, as evidenced by a 19.08% increase in open interest to 12,154 contracts, alongside a price decline of Rs 4,680. Silver is currently finding support at Rs 232,730, and a breach of this level may lead to exposure at Rs 230,025. On the upside, resistance is positioned at Rs 239,970, and a sustained movement above this threshold could propel prices toward Rs 244,505.
