Silver prices have reached record highs in 2025, prompting investors to question whether it's still a worthwhile investment. The surge has been fueled by increasing industrial demand, particularly from the green energy sector and the rise of AI, combined with persistent supply shortages.

Silver's Performance and Contributing Factors

Silver has significantly outperformed gold this year, with a year-to-date appreciation of approximately 125% in dollar terms, while gold has risen by around 63%. In India, silver prices have jumped about 157% since the beginning of 2025. This impressive rally can be attributed to several factors:

• Industrial Demand: Silver's unique properties make it essential in various technological applications, including solar cells, electric vehicles, electronics, and defense equipment. The expansion of these industries has led to increased demand for the metal.
• Supply Shortages: Structural supply deficits have further contributed to the price surge. Reports of shortages in major bullion markets like London have caused lease rates to spike.
• Safe-Haven Investment: The current macroeconomic climate, characterized by geopolitical uncertainty and expectations of lower interest rates, has driven investors towards safe-haven assets like silver.

Anil Agarwal's Bullish Outlook

Anil Agarwal, Chairman of Vedanta Group, has expressed a strong bullish outlook on silver. He believes that silver has emerged from the shadow of gold and is entering a long-term structural upcycle driven by technology-led demand. Agarwal highlighted that silver combines intrinsic value with strong functional demand, making it a unique commodity. He also noted that Vedanta, as India's only silver producer through Hindustan Zinc, is witnessing this trend firsthand.

Future Price Predictions and Investment Strategies

Predicting future silver prices is challenging, but several analysts have offered their forecasts. Motilal Oswal projects global silver prices to reach $70 per ounce by 2027, with domestic prices potentially reaching Rs 2.40 lakh by the end of 2026. Kothari anticipates silver in the $65-$80 per ounce range by 2026-end, with a potential upside to $95-$100 if supply disruptions persist and rate cuts deepen. Bank of America expects silver to average around $56 in 2026, with a possible peak of $65. Some analysts even suggest that silver could test the $100 level in 2026.

For investors considering silver, experts recommend a disciplined investment strategy. Aksha Kamboj advises against timing the market and suggests accumulating positions during price dips. Mathur recommends investing in silver in a staggered manner, taking advantage of price dips of 8-10% in 2026. For aggressive investors, Mathur suggests a portfolio of precious metals with 60-70% allocated to silver and the remaining 30-40% to gold.

Potential Risks

Despite the positive outlook, potential risks could impact silver prices. An unexpectedly hawkish Federal Reserve and a sharp rise in real yields could cool silver's momentum. A severe recession or stock market crash could also reduce industrial demand, negatively affecting prices. Geopolitical risks and election-year volatility could introduce further uncertainty.

Conclusion

Silver's record-high prices reflect its growing importance in various industries and its appeal as a safe-haven asset. While forecasts vary, many analysts remain optimistic about silver's potential for further growth in 2026. Investors should carefully consider their risk tolerance and investment strategy before entering the silver market, keeping in mind both the potential rewards and the inherent risks.