Silver posts a whopping 70% YTD gain: Four reasons why white metal is surging and what lies ahead

On Friday, October 10, silver prices saw the steepest single-day surge in the recent past and skyrocketed ₹8,500 to hit a new record of ₹1,71,500 per kilogram in the national capital.

According to the All India Sarafa Association, the white metal closed at ₹1,63,000 per kilogram on Thursday.

Silver prices soared by ₹17,500 per kg in the past three consecutive sessions.

Meanwhile, gold prices retreated from their record highs.

The yellow metal of 99.9% and 99.5% purity fell by ₹600 each to ₹1,26,000 and ₹1,25,400 per 10 grams (inclusive of all taxes), respectively, on Friday.

On Thursday, the precious metal of both categories had closed at record levels of ₹1,26,600 and ₹1,26,000 per 10 grams.

Globally, Comex silver futures for December delivery hit a high of $49.96 per ounce on Friday, while spot silver briefly breached $51 per ounce on Thursday before retreating to close at $50.29 per ounce.

Riya Singh of Emkay Global Financial Services said, "Silver's historic run reached a fever pitch last week, with spot prices climbing to the $51.24-an-ounce mark on Thursday, the highest level since 1980, before correcting to around $50 amid intense volatility and supply constraints."

Singh noted that the white metal remains the standout performer of 2025, posting a remarkable 70% year-to-date gain, driven by three factors such as industrial demand, speculative interest, and safe-haven flows.

Besides, the severe tightness in the London bullion market amplified price swings, with the implied one-month lease rate surging to 11%, the highest since 2022, reflecting a scarcity of lendable silver. Aggressive shipments of bullion to the US amid tariff fears drained London inventories to multi-year lows, flipping usual premiums and discounts of up to $2.50 per ounce versus Comex futures in New York, Riya Singh added.

"Sustained tightness in London and ongoing macro uncertainty could maintain upside momentum, though volatility will likely remain elevated as speculative long positions reach their most extended levels in years," she said.

Gold outlook

Gold prices are expected to remain volatile in the coming week as traders weigh domestic festive demand and physical market premiums against key macroeconomic data releases and political developments in the US, analysts said.

Investors will also closely monitor commentaries by Federal Reserve officials, including Chair Jerome Powell, on Tuesday, which will provide more cues on the trajectory of gold prices in the near term.

"In the next week, focus will be on the physical demand for bullion during the festive season in India, along with global political and geopolitical developments, particularly the passage of the US spending bill and efforts to resume diplomacy on ending the Russia-Ukraine war. These factors are likely to shape gold price trends in the coming months," Pranav Mer, Vice President, EBG - Commodity & Currency Research, JM Financial Services Ltd, said.