Silver hovers at record highs

Silver traded around $49 per ounce on Thursday, consolidating near record highs after briefly touching a new all-time peak in the previous session, as heightened political and economic uncertainty bolstered safe-haven demand.

The metal continued to draw strength from expectations of U.S. interest rate cuts, with investors assessing the impact of the prolonged government shutdown that has disrupted key economic data releases and clouded the Federal Reserve’s policy outlook.

Minutes from the latest FOMC meeting revealed that officials acknowledged rising downside risks to the labor market and the broader economy, noting that weaker hiring trends and delayed government spending could justify policy easing in the near term.

Still, concerns about sticky inflation kept some policymakers cautious, leaving markets closely attuned to upcoming speeches by Fed officials for further signals.

Political instability in major economies added to the risk-off mood. In France, renewed pressure on President Emmanuel Macron to call early elections triggered volatility across European markets, while Japan’s recent leadership reshuffle has introduced additional uncertainty around the country’s fiscal stance and yen policy.

Beyond macro drivers, silver remained underpinned by tightening physical market fundamentals. Demand from industrial users—particularly in solar panels, electric vehicles, and advanced electronics—has continued to outstrip supply, contributing to persistent structural deficits.

The Silver Institute forecasts a fifth consecutive global shortage in 2025, with demand projected to exceed supply by more than 100 million ounces.

Analysts note that the combination of safe-haven and industrial demand could sustain elevated prices well into next year, especially if central banks pursue synchronized monetary easing.