Silver, often nicknamed the ‘Devil’s metal’ because of its volatility, has reached record highs this year and still has further to run despite a supply crunch, according to experts.
The metal’s growth value has been running alongside gold’s, which has seen its own rally with the price surging past $4,000 an ounce this year.
Silver prices reached a historic peak of $54.47 per troy ounce in mid October, marking a 71% rise year-on-year. They’ve since pared back gains somewhat, but are now growing again, despite low supply levels.
“Some people were having to transport silver by plane rather than on cargo ships to meet delivery demand,” Paul Syms, head of EMEA ETF Fixed Income and commodity product management at Invesco, told CNBC.
“While we’ve seen the spike up, we’ve seen the price come down a little bit. Longer term, there’s a different dynamic this time that could keep silver at reasonably high prices and maybe continuing to go up for some time to come,” he added.
October was only the third time in the past 50 years where silver prices peaked. Other silver price highs include January 1980, when the Hunt brothers amassed a third of the world’s supply as they attempted to corner the market, as well as 2011, following the U.S. debt ceiling crisis when silver and gold were embraced as safe haven assets.
Silver prices year-to-date
“Silver is only about a tenth the size of the gold market, and that short squeeze, obviously, sort of caught a few investors by surprise,” said Syms.
Unlike the previous investment waves, silver’s boom in 2025 relied on a mix of low supply and high demand from India as well as industrial needs and tariffs.
“After Liberation Day, the gold price spiked, but silver actually went down a little bit. And the gold-silver ratio spiked to above 100,” said Syms, referring to the gold-silver ratio which reflects how many ounces of silver are needed to buy one ounce of gold.
A low ratio means gold is relatively cheap, while a high ratio indicates silver is undervalued and likely to rise. In April, the ratio reached a historic high.
“The risk managers in financial and industrial entities did not want to let any metal go out of the States for fear that it might come back in at 35% higher for example,” said Rhona O’Connell, head of market analysis EMEA and Asia at Stone X.
Fast forward to the Autumn and silver entered its peak demand, especially as India’s monsoon and harvest seasons came to an end.
“Farmers don’t really like the banks very much, so gold and latterly, silver, tend to be the first port of call when they’ve got the harvest in,” said O’Connell.
India is also the world’s largest consumer of silver, with about 4,000 metric tons used every year, mostly for jewelry, utensils and ornaments.
The silver appeal this Autumn also coincided with Diwali, a five-day ‘Festival of Lights’ celebrating prosperity and good fortune and also India’s biggest public holiday.
Supply crunch
While gold is traditionally a favorite, this year silver — an affordable investment option in a country where about 55% of the population depends on agriculture for their livelihood — outshined other metals.
On Oct. 17, the price of silver in India rose sharply, reaching a record high of 170,415 rupees a kilogram — an 85% rise since the start of the year.
However, 80% of India’s silver supply is imported. The UAE and China are increasingly supporting that demand, but the U.K. is traditionally India’s largest silver supplier.
Yet, London’s vaults have been emptying rapidly for the past few years. In June 2022, the London Bullion Market Association held 31,023 metric tons of silver. By March 2025, volumes had fallen by around a third to 22,126 metric tons — its lowest point in years.
“What isn’t necessarily so visible to people is what’s happening in the vaults,” said O’Connell. “And that had reached a point where there was basically there was no available metal left in London.”
In October, the squeeze was such that traders had to pay much higher borrowing costs – or lease rates – to close their positions.
“At one stage, to borrow overnight was costing 200% on an annualized basis, so a lot of people were very stressed to put it mildly,” said O’Connell.
Supply is a constant issue for silver, as for other precious and rare metals. The Silver Institute’s 2025’s World Silver Survey estimates that mine production has been decreasing over the past 10 years, especially in Central and South America.
“Over the course of the past twelve months or so, the underlying surplus has started to turn into a deficit for three reasons: the impact of the electrification of the vehicle fleet, artificial intelligence, and photovoltaics,” said O’Connell.
“At the moment, a standard electric vehicle has about 25 grams of silver, maybe the larger EVs have 50 grams of silver as part of their components,” said Syms.
“If we move into these solid-state silver batteries, each electric vehicle might require a kilo or more of silver,” he added.
And with silver having a high thermal conductivity and a higher electrical conductivity than other metals, as well as increasing demand for EVs, AI and renewables, the metal’s value is likely to keep shining.
“Silver crosses over that bridge between precious and industrial metals, and the way technology is going on, the batteries, the solar panels, it’s got some great use cases as we move into a more electrified world,” said Syms.