Silver prices surged above $33.50 per ounce on Thursday, marking a fourth consecutive session of gains as mounting concerns over the US fiscal outlook weighed heavily on the dollar and spurred increased demand for safe-haven assets.
Silver extends rally on US fiscal worries
Investor sentiment took a hit following projections that President Donald Trump’s proposed tax bill could add more than $3 trillion to the already substantial US debt burden, intensifying fears about long-term financial stability and the sustainability of US government finances.
Adding to the bearish sentiment on the dollar, a weak 20-year Treasury bond auction further signaled waning investor confidence in US debt instruments. This development fueled expectations that global investors are increasingly rotating out of US assets, redirecting capital toward traditionally safer havens such as precious metals. The resulting dollar weakness has made silver more attractive, both as a store of value and as a hedge against potential currency volatility.
Beyond safe-haven buying, the industrial demand for silver continues to provide strong support for prices, especially from the rapidly growing renewable energy sector. Recent data highlighted a surge in China’s renewable energy capacity, with wind and solar installations reaching nearly 1,500 GW in the first quarter of 2025—driven predominantly by a remarkable 60 GW increase in photovoltaic solar power installations. This expansion underscores China’s commitment to green energy and its significant influence on global silver consumption, given the metal’s essential role in solar panel production.
Solar power output grows
Meanwhile, Europe also demonstrated robust growth in solar power output, with a 30% year-on-year increase during the same period. This expansion reinforces the bullish fundamentals underpinning silver demand, as the metal is a critical component in photovoltaic cells and other renewable technologies. With governments worldwide intensifying efforts to transition to cleaner energy sources, the outlook for silver’s industrial use remains strong.
Taken together, these factors — from fiscal concerns and dollar weakness to robust industrial demand — continue to drive upward momentum for silver prices, positioning the metal as both a financial safe haven and a key material in the global shift toward sustainable energy.
