Silver closed Monday at $58.00 per ounce, down 3.97% on the week and 17.20% lower on the month. The metal has now lost 19.74% since the start of 2025, a stark reversal from the all-time high of $121.78 struck on January 29, 2026 — a decline of 52.38%. Yet the 52-week low of $45.51, set on October 27, 2025, still sits 27.44% below current levels, underscoring the extreme volatility that has gripped the market.
The sell-off has been driven by a toxic mix of geopolitical escalation and shifting rate expectations. US-Iran military clashes on July 12-13 sent oil prices surging, reigniting inflation fears and prompting markets to price in a roughly 70% probability of a Federal Reserve rate hike in September after Governor Christopher Waller warned that a hot core CPI reading could force tightening. The dollar index jumped to 101.24, adding further pressure on dollar-denominated commodities. Against that backdrop, silver tumbled 4.04% on July 13 to $57.74, underperforming gold, which lost 2.78% to $3,999.40. The day’s range spanned $59.80 to $57.60.
Silver’s dual nature makes it especially vulnerable. As a monetary metal, it suffers alongside gold from rising rate expectations; as an industrial input, it is also exposed to growth concerns. That double hit pushed the gold-silver ratio to 69.4, well above the 50-year average of roughly 65, meaning it now takes nearly 70 ounces of silver to buy one ounce of gold.
The real paradox, however, lies beneath the price action. The physical market is tightening at a pace that ought to provide a floor. For 2026, the global silver market is expected to run a deficit of 46.3 million ounces — the sixth consecutive shortfall, bringing the cumulative drawdown since 2021 to 762 million ounces, nearly an entire year’s worth of mine production. Yet supply is structurally constrained: only 26-28% of global output comes from primary silver mines, while the rest is produced as a byproduct of copper, lead, zinc and gold mining. New primary mines take seven to ten years on average to reach production, some as long as 30 years.
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Warehouse data confirms the strain. COMEX registered silver inventories have plunged more than 75% from their 2020 peaks, leaving freely available stocks at just 79.9 million ounces as of mid-2026. Meanwhile, India — which imports over 80% of its silver — saw inbound shipments collapse from 534.3 tonnes in May 2025 to a mere 46.8 tonnes in May 2026 after the government imposed licensing requirements on granules and powders. Local premiums soared to $6.50 per ounce above the global spot price. China, once a net exporter, imported roughly 1,626 tonnes in the first quarter of 2026 alone as it transitioned to a net buyer.
On the demand side, the composition is shifting. The solar industry, facing high silver prices, is substituting copper metallization, cutting its silver consumption by an estimated 19% in 2026 to around 151 million ounces. But new demand is emerging from elsewhere. Data centers that power artificial intelligence chips are using silver-bearing pastes to cool components that reach operating temperatures of up to 350 degrees Celsius. Together with electric vehicles and 5G infrastructure, these segments are keeping total demand at historically elevated levels despite the solar pullback.
Technically, the near-term outlook remains fragile. FXEmpire analyst Bruce Powers notes that a break below $55.60 opens the door to the 88.6% Fibonacci retracement at $54.23, with a deeper decline potentially testing the 78.6% level at $48.29. Resistance sits at the 20-day moving average zone of $60.77-$61.34. The 50-day MA at $69.93 and the 200-day MA at $73.41 lie 17.06% and 20.99% above current levels respectively. The RSI of 36.5 is not yet in oversold territory, while the annualized 30-day volatility of 51.77% leaves the market exceptionally prone to sharp swings.
All eyes are now on US inflation data due for release, which will shape the Fed’s next move. A softer print could relieve some pressure and allow the underlying supply deficit to reassert itself. For now, the tug-of-war between macro headwinds and physical scarcity keeps silver caught in a volatile, unpredictable range.
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