Silver Outshines Gold Again as Prices Touch Fresh High on Strong Global Cues

Silver prices in Delhi jumped ₹2,400 to a new all-time high of ₹1,94,400 per kilogram on Thursday, driven by a weakening rupee and strengthening global cues, including an interest rate cut by the US Federal Reserve. The All India Sarafa Association confirmed this. Silver also rose by ₹11,500 on Wednesday to a record high of ₹1,92,000 per kg. Silver prices have risen by ₹1,04,700, or 116.72 percent, since the beginning of this calendar year, from ₹89,700 per kg on December 31, 2024.

Dilip Parmar, Research Analyst at HDFC Securities, said, "Driven by strong physical and investment demand, silver prices hit another record high on Thursday. A combination of supply shortages in the market, record-breaking international silver prices, and a weak Indian rupee have significantly supported the rally in domestic prices."

He further added that silver has outperformed gold this year due to a combination of global supply shortages, continued high demand from China, and a surge in industrial consumption. Parmar further said, "The spot price of silver is witnessing a strong rally in the domestic market and is expected to move towards Rs 2,10,000 per kg in the coming days."

In the local bullion market, the price of gold of 99.9 percent purity increased by Rs 90 to Rs 1,32,490 per 10 grams from the previous closing price of Rs 1,32,400 per 10 grams. Globally, the spot gold price fell by US$15.55, or 0.37 percent, to US$4,213.12 per ounce.

Spot silver gained for the third consecutive session and rose by US$ 1.06 or 1.71 percent to reach a record US$ 62.88 per ounce. So far this year, the price of the metal has increased by US$33.91, or 117.06 percent, from US$28.97 per ounce on December 31, 2024.

The US Federal Reserve's decision to cut key interest rates by 25 basis points amid persistent inflation has further strengthened the bullish sentiment in precious metals. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold and silver, attracting new investments.

Harish V, Head of Commodity Research at Geojit Investments Ltd., said, "Gold prices are already at record highs. This policy change further accelerates the rally as investors seek safe havens amid economic uncertainty and inflationary pressures."

He added that the weakness in the US dollar following the rate cut is further supporting gold and silver prices, as the weakening dollar has made these metals more affordable for global buyers. Harish V said, "The sharp rise in silver prices is due to structural supply constraints, strong industrial demand for silver, and continued investments in ETFs."