new York
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Gold is not the only precious metal experiencing a blockbuster rally.
Silver prices have surged about 75% this year, boosted by investors seeking safe havens, as well as strong industrial demand and persistent supply deficits.
Spot silver prices hit a record high of $51 per troy ounce on Thursday, crossing the $50 threshold for the first time since 1980.
Traders have turned to hard assets like gold and silver this year as safe investments and tools to hedge against geopolitical instability and economic uncertainty, from worries about tariffs and inflation to worries about the independence of the Federal Reserve and the government debt burden.
Silver is on a tear, buoyed by momentum from gold’s record rally. The metal is seen as an alternative and cheaper safe haven than gold, which just hit $4,000 per troy ounce for the first time.
“There’s a lot of worry about the global economy and when that happens, people turn to hard assets like silver,” Michael DiRienzo, CEO of the Silver Institute, told CNN. “Silver tends to follow gold upwards. »
As investor demand drives up prices, silver is also widely used in industry, including building data centers, solar panels and smartphones.
“Its dual role as an industrial metal and a safe-haven asset has amplified the rally, making 2025 a historic year for silver,” Ewa Manthey, commodities strategist at ING, said in an email.
There are also supply issues that could warrant a price increase.
The silver market is in its fifth year of structural supply deficit due to “stagnant mining production” lagging behind demand, according to Peter Grant, vice president and senior metals strategist at Zaner Metals.
“Strong and growing demand for silver, combined with a persistent supply deficit, is a recipe for higher prices,” Grant said in an email.
Gold prices have soared over the past two years, driven by investors diversifying into safe havens. The decrease in dependence on the dollar and the building of gold reserves by central banks have also pushed prices up.
The safe-haven rally has extended this year to other precious metals like silver and platinum. Silver and platinum, which are up about 75% and 80% respectively this year, are both outpacing gold, which is up about 51%.
Precious metals and bitcoin have also become beneficiaries of Wall Street traders and money managers looking to hedge against a weaker dollar.
Investors can gain exposure to silver by purchasing bars or coins or by investing in silver-backed exchange-traded funds. The iShares Silver Trust ETF has surged about 68% this year.
Inflows into silver ETFs this year are at their highest level since 2020, according to Marina Smirnova, chief investment officer at Sprott Asset Management.
“The steady rise of money turns into a breakthrough,” Smirnova said. “Supply is dwindling and investors are taking note. »
