Silver prices fell sharply on the final trading day of 2025 as investors booked profits after an extraordinary run-up earlier in the year. On Wednesday MCX silver dropped about 7.5%, losing over ₹18,000 per kilogram to close near ₹232,228/kg, while COMEX touched an intraday low of $70.315 and traded close to $71 per ounce, down roughly 9% from the prior close.
Where the silver price rally stands now
Even with the recent correction, silver is on track for its strongest annual performance on record. Over 2025 the white metal rose nearly 150%, outpacing gold’s roughly 65% gain. Market participants say the correction reflects short-term profit-taking rather than a collapse of the broader trend, with several supply and demand factors continuing to support prices.
Analysts point to a mix of geopolitical uncertainty, a softer US interest rate outlook and heavy inflows into exchange-traded products as key drivers behind the year’s rally. Minutes from the Federal Reserve’s December meeting showed that many officials view additional rate cuts as possible if inflation keeps easing. That prospect reduced the opportunity cost of holding non-yielding assets such as gold and silver.
Geopolitical tensions also boosted safe-haven demand. Ongoing war-related uncertainty in Europe, heightened friction in the Middle East and strained relations between the United States and Venezuela were cited as factors that lifted investor interest in precious metals through the year.
Sellers on exchanges have been countered by growing physical demand. Sugandha Sachdeva noted that participation in the silver market has become more physical, moving from speculative paper positions to industrial buyers and long-term holders in Asia, London and Singapore. That migration has reduced dependency on exchange warehouses and bolstered the case for sustained prices despite intermittent volatility.
Supply constraints and low inventories have also played a part. Silver’s dual role as an industrial metal and financial asset has meant robust demand from manufacturers alongside investor and central bank purchases, tightening available supplies in key storage hubs.
From a technical viewpoint, traders will be closely watching established support levels. Anuj Gupta said $70 per ounce is a crucial near-term level; a breach could see tests of $68 and $65. Conversely, Renisha Chainani of Augmont expects a period of range-bound trading, with silver likely to consolidate between $70 (around ₹223,000) and $78 (near ₹250,000) following this week’s volatility.
For market participants the immediate task is risk management. Analysts advise maintaining disciplined stop-losses and avoiding aggressive directional bets until price stabilises above key thresholds. The consensus among several market strategists is for consolidation rather than a sustained reversal, given the large structural buyers now present in the market.
In short, the recent slide represents a significant correction after an exceptional rally but not necessarily the end of the silver price rally. Physical demand, central bank activity and a favourable interest-rate backdrop leave the metal with fundamentals that could support higher levels over the medium term, even as traders navigate near-term swings.
Disclaimer: Views and recommendations are those of the quoted analysts and not of this publication. Investors should consult certified advisers before making financial decisions.
Key Takeaways:
- Silver plunged on profit booking after a remarkable 2025 rally, with MCX down about 7.5% and COMEX near $71/oz.
- Despite the correction, silver posted nearly 150% gains in 2025 and remains supported by physical demand, central bank buying and ETF inflows.
- Analysts say the silver price rally has shifted from paper traders to industrial users and long-term holders, pointing to continued structural support.
- Key technical levels to watch are $70, $68 and $65 per ounce, with an expected consolidation between $70 and $78.
