Silver Markets Rally on Asian Gains and Industrial Buying Despite Trade Policy Uncertainties

Silver prices demonstrated mixed performance across global markets on May 29, 2025, with the precious metal trading above $33.10 per ounce internationally while showing gains in Asian futures markets despite broader uncertainties around U.S. trade policies.

As of May 29, 2025 morning, silver prices rose past $33.1 per ounce, testing the highest level in three weeks. In Indian markets, the MCX silver futures contract maturing on July 4, 2025, opened with a gain of Rs 307 at Rs 97,562 per kg.

It subsequently touched a high of Rs 97,860 and was trading at Rs 97,772 with a gain of Rs 517 or 0.53%. The domestic Indian silver price stands at ₹99.90 per gram and ₹99,900 per kilogram, representing a decline of ₹0.10 from the previous day.

Overnight and Previous Day Action

Silver markets experienced a mixed overnight session following declines on May 28, 2025. Vietnamese markets reported widespread decreases on May 28, with world silver prices falling to 858,000 VND/ounce (buy) and 863,000 VND/ounce (sell).

However, the metal found support and rebounded during Asian trading hours on May 29.The recovery was driven by several factors including a pullback in the U.S. dollar and evidence of ample industrial buying.

Additionally, a U.S. federal court blocked President Donald Trump‘s ‘Liberation Day’ tariffs on imports under an emergency-powers law, which initially pressured gold but allowed silver to gain momentum.

Global Market Performance

Asian Markets: Indian MCX silver futures showed strong performance with gains exceeding 0.5%, while Chinese industrial demand remained robust with wind and solar capacity rising to nearly 1,500 GW in the first quarter due to a 60GW jump in photovoltaic power.

European Markets: Solar power output in Europe surged by 30% annually in the first quarter, supporting industrial silver demand.

U.S. Markets: Silver investment demand has faced challenges, with ongoing concerns about Chinese economic prospects weighing on the metal and contributing to an elevated gold-to-silver ratio.

Market Fundamentals

The silver market is forecast to remain in a sizeable deficit for the fifth consecutive year in 2025, with industrial demand expected to hit a new record high. According to the Silver Institute, global silver demand is expected to remain broadly stable at 1.20 billion ounces in 2025.

However, the global silver deficit is expected to narrow by 21% to 117.6 million troy ounces in 2025 due to a 1% fall in demand and a 2% increase in total supply. Total industrial demand for silver is expected to be steady in 2025 after reaching a record high of 680.5 million ounces in 2024.

ETF Flows and Investment Demand

Silver ETFs showed positive momentum with the iShares Silver Trust gaining 0.16%, adding 728,604.8 ounces despite an overall year-to-date drop. This contrasts with gold ETFs, which saw outflows, indicating shifting investor preferences toward silver.

Demand for silver coins and bars is expected to rise 7% this year after falling by 22% in 2024 to a five-year low of 190.9 million ounces.

Technical Analysis

From a technical perspective, silver recently reversed from the resistance level of $33.70, which represents the upper border of the sideways price range that has contained trading since April.

According to technical analysts, the resistance area near $33.70 was strengthened by the upper daily Bollinger Band, and silver may be expected to fall toward the next support level at $31.70.

However, other technical indicators show silver has been declining in recent intraday trading, surpassing the support of its EMA50, but finding support at a bullish trend line on a short-term basis with positive overlapping signals appearing on the RSI after reaching oversold levels.

Market Drivers and Outlook

Several key factors are driving silver’s current performance:

Geopolitical Tensions: Reports that Israel is considering striking Iran have extended geopolitical tensions, supporting demand for safety assets including silver.

Industrial Demand: Higher investments in solar panels, the main industrial use for silver, maintained buying from factories. The transition to green energy technologies continues to create positive pressure on silver prices.

Currency Dynamics: The dollar’s pullback despite fresh increases in long-dated Treasury yields has supported precious metals, reflecting lingering doubts about U.S. asset exceptionalism.

According to market analysis, “at present investors have been treating silver more as an industrial metal than a safe haven asset”. The gold-to-silver ratio stood at 102 in early May, highlighting silver’s relative attractiveness compared to gold.

Analysts from Elliott Wave International note that “silver is going to outperform gold… the gold-to-silver ratio is going to start declining,” highlighting silver’s greater potential upside.

Silver has been displaying notably stronger technical patterns compared to gold, with a pronounced upward trend that began on April 7, 2025.

Looking ahead, silver prices are expected to trade at $33.10 per ounce by the end of this quarter, with estimates of $35.71 in 12 months’ time. The metal has increased 14.69% since the beginning of 2025.

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