Will Silver Prices Touch Rs 1.5 Lakh per Kg Amid Trade Tensions?

New Delhi, Sep 9 (NationPress) It is anticipated that silver prices in India could surge to as much as Rs 1.5 lakh for each kilogram in the foreseeable future, propelled by escalating industrial demand, safe-haven investments, and a growing supply shortfall, according to a recent report released on Tuesday.

In the latest edition of the Precious Metals Quarterly report, Motilal Oswal Financial Services Limited (MOFSL) has advised investors to consider purchasing silver during market dips. The brokerage highlighted that the metal is receiving substantial backing from trade disputes, strong investment influx, and rising demand from sectors like electronics and renewable energy.

Silver has experienced a notable increase, boasting a 37 percent YTD rise, driven by both safe-haven investments and industrial applications.

"Following the achievement of earlier targets of Rs 1,11,111 and Rs 1,25,000, silver is projected to advance towards Rs 1,35,000 and subsequently Rs 1,50,000 in the domestic market (assuming an exchange rate of USD to INR at 88.5)," the firm noted, adding that on COMEX, silver might test $45 and then $50.

Long-term support levels are expected to hover around the Rs 1,04,000 to Rs 1,08,000 range, with suggestions for purchasing on dips over a 12 to 15-month timeframe, as stated by MOFSL in a release.

In 2025, silver displayed an 81 percent correlation with gold and 75 percent with copper, emphasizing its dual function as both an investment and industrial metal, according to the brokerage firm.

Geopolitical tensions, tariff uncertainties from the US government, and predictions of a 25 basis points rate cut in September are key factors supporting this upward trend.

Additionally, the International Monetary Fund (IMF) has upgraded its global growth forecasts, while inflation rates remain close to central bank targets, as noted by MOFSL.

It is expected that industrial demand will constitute nearly 60 percent of total production in 2025. China's GDP growth remains stable at 5 percent, despite challenges, and PV module exports reached 127 GW in the first half of CY25, enhancing silver's industrial demand outlook.

While jewelry demand is projected to decline by 6 percent this year, supply constraints persist, resulting in a fifth consecutive year of market deficit, as indicated by the brokerage firm.

Silver ETFs and ETPs have seen significant inflows in 2025, with the Saudi Central Bank investing $40 million in silver-linked ETFs. Furthermore, Russia plans to acquire $535 million in silver for its reserves.