Silver to Reach $100/oz by 2026-End on Record Industrial Demand, Growing Perception as Store of Value

Precious metals, led by Gold, continue to see record demand as prices hit new highs amid uncertainty related to the US government shutdown, an emerging dollar debasement trend, expectations of lower interest rates, and geopolitical volatility driven by President Donald Trump imposing an additional 100% tariff on imports from China starting next month.

Trump's decision is likely in response to new export controls Beijing is planning for valuable rare earth minerals.

While gold futures have surged over 57% year-to-date on a rally that gained momentum after Trump's liberation day announcements, silver has been quietly making greater leaps, with silver futures up over 70% YTD to $49.7 (£37.2) during premarket hours on Monday. Meanwhile, spot silver prices reached all-time highs of over $51.3 (£38.4) per ounce.

Invesco's Paul Syms believes gold's explosive rally is driving investors to allocate money to other precious metals. 'Interest in silver picked up when the gold-silver ratio moved above 100x following the post "liberation day" gold rally,' he stated last week. 'The only time the ratio has previously been above 100x this century was during the pandemic and was followed by a sharp reversal.'

According to Syms, this time investors are viewing silver as a store of value for several reasons, including practical uses that gold cannot rival.

'Gold's trial uses are limited,' he said. 'From an investment case standpoint, silver is also perceived as a store of value but also has many industrial uses, particularly in electronics and renewable energy technologies.'

Meanwhile, Solomon Global Paul Williams attributed silver's rally to 'powerful, real-world forces' instead of speculations that drove it to a high in 1980.

'A deepening structural deficit, record industrial demand and accelerating investment in green technologies are tightening supply and pushing prices higher,' he wrote in a recent note. 'While silver doesn't share gold's full safe-haven credentials, its dual role as an industrial and store-of-value metal continues to draw investors seeking stability and upside.'

Silver is an important component in products across diverse industries, used heavily in the production of electrical switches, solar panels, semiconductors, and smartphones. Williams believes that the underlying drivers of the silver market are showing no sign of tapering off.

'Despite its record level, silver remains cheap compared to gold,' he noted. 'Given the current climate, a $100 (£75) silver price is certainly possible by the end of 2026.'

BNP Paribas Fortis' chief strategy officer, Philippe Gijsels, also believes silver's value could double from the new highs. While Gijsels expects a momentary pause in the silver rally before prices surge again, he thinks the conditions that catalysed the rally remain in place.

'We are still closer to the beginning than to the end of what could well become one of the largest bull markets in recorded history,' he added. 'I would not be surprised to see Silver well north of $100 in the not-too-distant future.'

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