New Delhi, Dec 27 (NationPress) Silver has achieved remarkable gains of 158 percent year-to-date (YTD) in 2025, as domestic spot prices have soared to nearly Rs 1,45,000 per kg, marking an increase of about 170 percent this year.

Experts suggest that strong industrial demand, limited supply, significant ETF inflows, and the US Federal Reserve's rate cuts could potentially push silver prices to $100 per ounce in the near future.

Key factors driving the demand for silver include its use in electric vehicles, solar energy, semiconductors, and data centers.

Moreover, a multi-year structural supply deficit of 148.9 million ounces in 2024 has positively influenced investor sentiment, along with expectations of further Fed easing by 0.75 percent and at least two rate reductions next year. A weaker dollar and geopolitical tensions are also contributing to increased demand for precious metals beyond industrial applications.

Geopolitical tensions have escalated with events such as the US blockade of Venezuelan crude, ongoing Russia-Ukraine conflicts, and US military actions against ISIS in Nigeria. Recently, the US Coast Guard seized a supertanker under sanctions carrying Venezuelan oil and attempted to intercept two additional ships related to Venezuela, intensifying tensions.

On Friday, MCX silver March futures peaked at Rs 2,32,741 per kg. Many analysts now believe that reaching the $100 per ounce benchmark is feasible by 2026, with most predicting silver prices will range between $70 and $85 per ounce in the upcoming year. They also note that silver's high-beta nature might lead to accelerated gains once key resistance levels are surpassed.

A recent report from Axis Mutual Fund cautioned that overvaluation could result in ETF outflows, and a downturn in copper prices could negatively impact silver values.

“Overall, we maintain a positive outlook for silver, supported by multiple factors contributing to its rally, even as valuations appear stretched,” the report stated.

However, central banks' preference for gold over silver may restrict its official demand support, and potential substitution in industrial applications poses additional risks.

aar/na