Factors Behind the Record Rise in Silver Prices

Historical Rise in Silver Prices

The price of silver per ounce has become one of the most attention-grabbing investment instruments of 2025. While gold reached record levels this year, silver also showed a similar increase. With the Federal Reserve's (Fed) planned interest rate cuts as the year comes to an end and the increasing demand for silver in the technology sector, the precious metal surpassed $60 for the first time in its history.

Market Impacts and Expectations

In the spot market, silver broke a new record by rising above the $60 level. Throughout 2025, as tariffs imposed by the U.S. and global economic uncertainties grew, while gold also reached record levels, falling interest rates and a weakening dollar directed investors towards safe-haven assets like silver and gold. In the announcement expected from the Fed this evening, a 25 basis point cut in the policy interest rate is anticipated.

Reasons Behind the Increase in Demand

An analysis in BBC by Yeow Hee Chua from Nanyang Technological University stated, "As the return on holding cash in the bank decreases with interest rate cuts, demand for assets like silver, seen as a store of value, shifts." While gold has gained more than 50% in value this year, the value increase in silver has also attracted significant attention.

The Role of the Technology Sector

According to analysts, strong demand in the technology sector has exceeded supply, doubling silver prices over the year. Silver is not only a precious metal but has also become a critical material for electric vehicles (EVs), solar panels, and advanced battery technologies. Kosmas Marinakis from Singapore Management University stated, "Silver is a physical resource that manufacturers increasingly need."

Stockpiling Movements in the U.S.

Moreover, silver production cannot be increased rapidly; a significant portion of global production is obtained as a by-product in mines where metals like copper or lead are extracted. Silver prices have further risen due to concerns over potential tariffs in the U.S. This situation has triggered stockpiling activities in the U.S. and caused disruptions in global supply. The U.S. imports about one-third of the silver used for production and investment purposes, and producers are quickly stockpiling to avoid disruptions in their supply chains.