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Informist, Wednesday, Jun. 18, 2025

--MCX Jul silver contract hits fresh record high of INR 109,748 per kg

--MCX Sept silver contract hits fresh record high of INR 111,000 per kg 

NEW DELHI – The price of silver hit a fresh all-time high on the Multi-Commodity Exchange of India Wednesday. Silver prices have been rising as the conflict in west Asia continues. Resilient industrial demand and short-covering are also pushing up the price of the metal, according to analysts.

The July silver contract on the MCX rose to a lifetime high of INR 109,748 per kg Wednesday. The September silver contract also hit an all-time high of INR 111,000 per kg. At 1734 IST, the most-active July silver contract on the MCX was 0.3% higher at INR 109,365 per kg.

The Israel-Iran conflict escalated Wednesday as both countries continued their strikes on each other for the sixth day, which added to the safe-haven appeal of precious metals, with both combatants targeting critical energy infrastructure, fuelling market volatility, said Ajay Kedia, director at Kedia Advisory.

Prices also rose as the rupee fell against the dollar and on sustained demand for silver. The rupee ended at a 10-week low against the dollar Wednesday with the conflict in west Asia prompting importers and foreign portfolio investors to continue buying the greenback. After moving in a range of 29 paise during the day, the rupee settled at 86.4775 a dollar, against 86.2400 Tuesday. When the rupee depreciates against the dollar, silver prices adjust in the domestic market as the commodity is priced in rupee terms.

Silver's critical role in the green economy, particularly in solar power, electronics, and electrification, now represents over half of global demand, underscoring the metal's long-term structural importance, Kedia Advisory added in a note.

Demand from industrial fabrication, silver's primary demand driver, is expected to rise 3% in 2025, exceeding 700 million ounces for the first time, according to analysts. Total global demand for silver is seen holding steady at 1.2 billion ounces, with gains in industrial applications and physical investment offset by weaker jewellery and silverware demand, they said.

Meanwhile, the Silver Institute forecast a fifth consecutive annual supply deficit for the white metal in 2025, projected at 117.6 million troy ounces. Though the deficit is expected to narrow 21% this year, supply constraints may continue to support elevated price levels, according to Kedia Advisory. In addition, physical investment demand for coins and bars is projected to rebound 7% after a sharp 22% drop in 2024. Improving sentiment in Europe and North America is driving fresh investment, with Western investors adjusting to higher price levels.  End

Reported by Pallavi Singhal

Edited by Rajeev Pai

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

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