Silver prices held near multi-year highs on Tuesday, buoyed by persistent supply shortages, strong industrial demand, and elevated geopolitical risks.
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The ongoing Israel-Iran conflict has triggered fresh waves of safe-haven buying, especially as both nations target critical energy infrastructure.
Structurally, the outlook for silver remains positive, with forecasts predicting a 3% increase in industrial fabrication by 2025, which would surpass 700 million ounces for the first time.
Solar energy and electronics are expected to continue driving long-term demand. Although overall demand is expected to remain stable at 1.2 billion ounces, the market is projected to record its fifth consecutive annual deficit, suggesting a positive outlook for the commodity.
Despite the constructive backdrop, investors’ caution ahead of Wednesday’s Federal Reserve policy meeting could cap further upside. The Fed is expected to hold rates steady, but markets are focused on forward guidance, particularly regarding potential cuts later this year. A dovish tone could reinforce silver’s non-yielding appeal, while a hawkish tone may weigh on silver prices after recent gains.
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