Mohammedia – Silver prices surged to record levels this month, rising above $115 an ounce and briefly touching about $119, prompting warnings from some market analysts, while others pointed to persistent supply constraints as a key driver of the rally.
Silver has gained more than 60% since the start of January and is up roughly 275% over the past year, according to market data. The move marks the metal’s strongest monthly performance since 1979, when prices spiked during an attempted market corner that later collapsed.
Some strategists have warned that the pace of the rally reflects speculative activity rather than changes in underlying demand. Former JPMorgan strategist Marko Kolanovic said in recent comments that silver could fall by about 50% within a year, citing momentum-driven trading and high turnover volumes.
Veteran trader Peter Brandt noted that more than 1.5 billion ounces of silver—nearly two years of global production—have changed hands on exchanges, a level last seen near the 2011 price peak.
Other banks have taken a more constructive view. Citigroup recently raised its near-term price target for silver to $150 an ounce, citing prolonged supply deficits and rising industrial use.
The bank said the market has recorded seven consecutive years of supply shortfalls and that demand from manufacturers reached record levels in 2025.
Industrial consumption remains a central factor in the outlook. Solar panel production is expected to use about 120 million to 125 million ounces of silver in 2026, while electric vehicle manufacturing is projected to require an additional 70 million to 75 million ounces, according to industry estimates.
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China has also tightened controls on silver exports after reclassifying the metal as a strategic material, with new licensing rules taking effect on January 1st.
Trading activity in exchange-traded funds has increased sharply. The iShares Silver Trust recorded single-day trading volumes close to $40 billion earlier this month, approaching levels typically seen in the largest U.S. equity funds.
HSBC said in a recent note that silver’s rise has largely followed gold higher and that momentum trading increased as prices accelerated.
The bank said it does not view silver as a safe-haven asset and cautioned that higher prices could eventually reduce industrial demand and encourage recycling and new supply.
The sharp move in silver has drawn attention across financial markets, including digital assets. Bitcoin recently traded around $88,235, after touching a 24-hour high near $90,476, with daily trading volumes of about $32.8 billion. Ethereum traded near $2,953, while Solana changed hands around $192, according to market data.
