Could MCX Silver Reach Rs 3.2 Lakh by 2026? Insights from Motilal Oswal
Synopsis
Motilal Oswal predicts MCX silver could soar to Rs 3.2 lakh by 2026, following a remarkable 170% increase last year. Factors like geopolitical tensions, industrial demand, and supply constraints may fuel this growth, offering investors a potential upside of 27%. Discover the insights driving silver's promising future!
Key Takeaways
MCX silver prices are projected to reach Rs 3.20 lakh by 2026.
A potential upside of 27% from current levels is indicated.
Geopolitical tensions and industrial demand are key drivers.
Silver has outperformed gold due to its dual role.
The silver market is in a structural deficit for the fifth consecutive year.
Mumbai, Jan 11 (NationPress) Following an impressive 170% surge in MCX silver prices last year, the renowned brokerage firm Motilal Oswal asserts that the white metal retains significant momentum to sustain its record-setting trajectory into 2026. Silver outshone not only gold but also a majority of major asset classes in 2025, marking its position as the top-performing precious metal.
According to Motilal Oswal's recent analysis, the robust ascent in silver and gold valuations was fueled by a combination of global dynamics, including escalating geopolitical tensions, trade uncertainties, accommodative monetary policies, substantial inflows into exchange-traded funds, supply limitations, and a heightened appetite for safe-haven assets.
The brokerage has set a target of Rs 3.20 lakh per kilogram for MCX silver by 2026, with a risk mitigation threshold established at Rs 1.40 lakh.
With current prices hovering around Rs 2.52 lakh, this projection indicates a potential increase of nearly 27%.
A consistent decline in exchange inventories has further fueled this rally. The firm highlighted that its previous price targets were reached much quicker than anticipated.
At the start of 2025, the firm forecasted gold to attain Rs 84,000 and silver to reach Rs 1,10,000 by the year's end.
However, gold achieved Rs 84,000 in the first quarter and later soared to an unprecedented high of Rs 1,40,465.
Silver surpassed Rs 88,000 by the second quarter and eventually peaked at an all-time high of Rs 2,54,000, more than doubling the brokerage’s initial predictions.
Motilal Oswal highlighted that silver has distinctly outperformed gold due to its unique dual capacity as both a precious and an industrial metal.
While global uncertainties have enhanced its appeal as a safe haven, increasing industrial demand has provided silver with additional upward momentum.
The report noted that industrial demand for silver reached its second-highest recorded level in 2025, driven by the rapid expansion of solar power installations, electric vehicle adoption, electrification efforts, and heightened investments in power grid infrastructure.
This robust demand has kept the silver market in a structural deficit for the fifth consecutive year, with consumption consistently surpassing supply.
The report indicates that this imbalance has led to brief periods of backwardation in prices, a rare occurrence that signifies limited physical availability in the market.
Point of View
I see Motilal Oswal's projection for MCX silver as a crucial indicator for investors. The interplay of global uncertainties and industrial demand highlights the importance of navigating the precious metals market wisely. Staying informed and adaptable will be key for those looking to capitalize on these trends.
NationPress
14 Jul 2026
Frequently Asked Questions
What has driven the recent surge in silver prices?
The surge in silver prices has been driven by a combination of geopolitical tensions, trade uncertainties, easier monetary policies, and increasing industrial demand.
What is the projected price for MCX silver in 2026?
Motilal Oswal projects that MCX silver could reach Rs 3.20 lakh per kilogram by 2026.
How much potential upside does this projection indicate?
The projection suggests a potential upside of nearly 27% from the current price of around Rs 2.52 lakh.
What role does industrial demand play in silver prices?
Industrial demand has significantly contributed to silver's price increase, particularly due to its use in solar power, electric vehicles, and advanced electrification projects.
What is backwardation in silver prices?
Backwardation in silver prices indicates a rare situation where demand exceeds supply, leading to tight physical availability in the market.
