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Silver Price Forecast: XAG/USD trades near $52.00 after pulling back from record highs

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Silver Price Forecast: XAG/USD trades near $52.00 after pulling back from record highs

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New update 2025.10.14 17:43
Silver Price Forecast: XAG/USD trades near $52.00 after pulling back from record highs

update 2025.10.14 17:43

  • Silver price surged due to growing concerns over liquidity shortages in London.
  • Silver is trading at a significant premium in India amid a surging festive demand.
  • The safe-haven Silver attracts buyers due to renewed US-China trade concerns.

Silver price (XAG/USD) maintains its position after retreating from a fresh record high of $53.77, currently trading around $52.40 per troy ounce during the European hours on Tuesday. Silver prices climbed as a historic short squeeze in London intensified a rally driven by soaring demand for safe-haven assets.

The price of the grey metal surged amid growing concerns over liquidity shortages in London, prompting some traders to secure cargo space on transatlantic flights for Silver bars, an unusually costly transport method typically reserved for Gold, in a bid to capitalize on higher prices in the London market, according to a Bloomberg report.

Meanwhile, Silver is trading at a significant premium in India compared to global prices, facing a surge in domestic demand from millions of investors. The premium has risen to as much as 10% above international rates, forcing physically backed exchange-traded funds to halt new subscriptions. Meanwhile, jewelers are struggling to keep up with strong festive demand ahead of Diwali.

The safe-haven demand for Silver surged amid renewed United States (US)-China trade tensions. The United States (US) and China decided to impose additional port fees on ocean shipping companies. The US is scheduled to start collecting fees on Tuesday.

China also started to collect the special taxes on US-owned, operated, built, or flagged vessels, but stated that Chinese-built ships would be exempted from the levies. However, China's Commerce Ministry said in a statement on Tuesday that Beijing "hopes to resolve concerns through dialogue."

Silver FAQs

Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.

Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply - Silver is much more abundant than Gold - and recycling rates can also affect prices.

Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals - more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers' demand for the precious metal for jewellery also plays a key role in setting prices.

Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.


Date

Created

 : 2025.10.14

Update

Last updated

 : 2025.10.14

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