Silver hit record highs in 2025 and still has further to run
Silver, often referred to as the ‘Devil’s metal’ due to its volatility, has reached record highs this year and still needs to move forward despite supply shortages, experts say.
The metal’s value growth is tracking alongside that of gold, which has had its own rise this year with prices exceeding $4,000 per ounce.
Silver prices reached their historical peak of $54.47 per ounce in mid-October, recording a 71% annual increase. They have since reduced their earnings somewhat but are now growing again despite low supply levels.
“Some people were having to move silver by plane rather than cargo ships to meet delivery demand,” Paul Syms, head of EMEA ETF Fixed Income and commodity product management at Invesco, told CNBC.
“Although we saw an increase, we also saw the price fall a little bit. In the long run, there is a different dynamic this time that could keep silver at reasonably high prices and perhaps continue to rise for a while,” he added.
It was October only the third time where silver prices have peaked in the last 50 years. Other periods when silver prices were highest include January 1980. Hunt brothers collect one-third of world supply While trying to corner the market, as in 2011 following the US debt ceiling crisis, silver and gold were adopted as safe haven assets.
Silver prices since the beginning of the year
“Silver is only a tenth the size of the gold market and this short squeeze has frankly caught a few investors by surprise,” Syms said.
Unlike previous investment waves, silver’s rise in 2025 was based on a mix of low supply and high demand from India, as well as industrial needs and tariffs.
“After Independence Day, the price of gold went up, but silver actually dropped a little bit. And the gold-silver ratio went up to over 100,” Syms said, referring to the gold-silver ratio, which reflects how many ounces of silver are needed to buy one ounce of gold.
A low ratio means gold is relatively cheap, while a high ratio indicates silver is undervalued and likely to increase. This rate in April historical high.
“Risk managers at financial and industrial institutions did not want to allow any metal to move out of the US for fear it might come back at a price that was, say, 35% higher,” said Rhona O’Connell, head of EMEA and Asia market analysis at Stone X.
As we race towards autumn, demand for silver has peaked, especially with the end of India’s monsoon and harvest seasons.
“Farmers don’t really like banks, so when the harvest comes the first port of call is gold and lastly silver,” O’Connell said.
India also world’s largest consumer of silverAbout 4,000 metric tons are used each year, mostly for jewelry, kitchenware and ornaments.
This autumn’s silver charm also coincides with Diwali, India’s biggest public holiday, a five-day ‘Festival of Lights’ celebrating prosperity and good fortune.
supply shortage
While gold has traditionally been the favourite, this year silver has eclipsed other metals as an affordable investment option in a country where around 55% of the population relies on agriculture for their livelihood.
On October 17, the price of silver in India increased sharply and reached a record high of 170,415 rupees per kilogram. 85 percent increase since the beginning of the year.
However, 80% of India’s silver supply is imported. The UAE and China are increasingly supporting this demand, but the UK has traditionally been India’s largest supplier of silver.
But London’s coffers have been rapidly emptying over the last few years. In June 2022, the London Bullion Market Association held 31,023 metric tonnes of silver. By March 2025, volumes had fallen by nearly a third to 22,126 metric tonnes; This is the lowest point in years.
“What people don’t really see is what’s going on in the vaults,” O’Connell said. “And it got to the point where there was basically no metal left in London.”
The squeeze in October resulted in traders having to pay much higher borrowing costs (or rental rates) to close their positions.
“At one stage the cost of borrowing money overnight was 200% on an annual basis, so a lot of people were very stressed about it to say the least,” O’Connell said.
For silver, as for other precious and rare metals, supply is a constant problem. The Silver Institute’s 2025 World Silver Survey estimates that mineral production has declined over the past 10 years, particularly in Central and South America.
“Over the past twelve months, the underlying surplus has begun to turn into a deficit for three reasons: the impact of vehicle fleet electrification, artificial intelligence and photovoltaics,” O’Connell said.
“Currently a standard electric vehicle has about 25 grams of silver, with perhaps 50 grams of silver as part of the components of larger EVs,” Syms said.
“If we switch to these solid-state silver batteries, each electric vehicle could need a kilo or more of silver,” he added.
Not only does silver have high thermal conductivity and higher electrical conductivity than other metals, but with increasing demand for electric vehicles, artificial intelligence, and renewable resources, the value of the metal is likely to continue to shine.
“Silver is crossing the bridge between precious and industrial metals and the way the technology is going, batteries, solar panels, it has some great use cases as we move towards a more electric world,” Syms said.
