Fresh High
Rising rate-cut bets, Fed independence worries push MCX silver to new high
This story was originally published at 21:10 IST on 28 August 2025
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--MCX Sept silver contract hits fresh record high of INR 117,635 per kg
--MCX Dec silver contract hits fresh record high of INR 118,902 per kg
MUMBAI – Silver contracts on the Multi Commodity Exchange of India rose to a record high Thursday on firm industrial demand and rising bets of an interest rate cut by the US Federal Open Market Committee at its September meeting. On COMEX, silver prices surged over 1% and are trading near a one-month high, supported by a weaker dollar.
On the domestic exchange, the silver contract for December delivery rose to a fresh record high of INR 118,902 per kg and the contract for September delivery rose to a record high of INR 117,635 per kg. At 2031 IST, the most-active December silver contract was up 0.9% at INR 118,433 per kg on the MCX.
Concerns over the independence of the US Federal Reserve after President Donald Trump Monday said he was firing Fed Governor Lisa Cook has raised the safe-haven appeal of silver, which is both a precious and an industrial metal. Cook filed a lawsuit Thursday in the federal court in Washington, DC, to block Trump's attempt to fire her, CNBC reported. Trump said he may consider White House economist Stephen Miran for Cook's seat should it become vacant.
Market participants have ramped up expectations of an interest rate cut by the US FOMC at the September meeting, a few days after Fed Chair Jerome Powell hinted at resuming rate cuts. Fed fund futures traders now see an 87% chance of a 25 basis-point rate cut by the FOMC in September, up from 75% a week ago, according to the CME's FedWatch tool.
On the industrial side, silver demand was bolstered by strong Chinese solar sector data, including a 70% surge in solar cell exports and record capacity additions, Kedia Advisory said in a note.
A sustained deficit in the global silver market is also supporting prices. According to The Silver Institute, the global silver market is expected to be in a deficit for the fifth straight year in 2025, at 117.6 million ounces. Total demand for the metal is projected to fall slightly to 1.15 billion ounces and total supply is estimated to rise by 1.5%, led by higher mine production.
"On current projections, the market is set for another notable deficit this year, even if the gap narrows versus last year. That structural shortfall has repeatedly limited the depth and duration of pullbacks when the dollar firmed or interest rate cuts (expectations) faded," Ole Hansen, head of commodity at Saxo Bank, said in a note.
According to Kedia Advisory, the September silver contract on MCX will move in the range of INR 114,000 and INR 122,000 in the short term. End
US$1 = INR 87.62
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Ashutosh Pati
Edited by Rajeev Pai
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