Silver prices have surged sharply in India. On January 19, silver crossed the historic milestone of ₹3 lakh per kilogram on MCX, registering a jump of over ₹14,000 in a single session. Just last Friday, silver was trading near ₹2.87 lakh per kg.
What’s even more striking is the speed of this rally. Silver reached ₹2 lakh per kg for the first time around mid-December 2025, meaning it took just one month to climb from ₹2 lakh to ₹3 lakh. In comparison, silver took 9 months to move from ₹1 lakh to ₹2 lakh, and a massive 14 years to rise from ₹50,000 to ₹1 lakh.
This sharp rally has raised key questions among investors: Why are silver prices rising so fast? Is this the right time to buy silver? And what are the safest ways to invest in silver?
Let’s break it down.
Why Are Silver Prices Rising So Sharply?
1. Strong Industrial Demand
Silver is no longer limited to jewelry. It is a critical metal used in:
- Solar panels
- Electric vehicles (EVs)
- 5G technology and electronics
With the global push toward green energy and clean technology, silver demand has reached record levels worldwide.
2. Supply Shortage
While demand is soaring, silver production is failing to keep pace.
- Mining output has not increased significantly due to strict environmental regulations in several countries
- Nearly 70% of silver is produced as a by-product of mining other metals like copper and zinc
- Unless copper mining rises, silver supply cannot increase meaningfully
This widening gap between demand and supply has created a persistent shortage, pushing prices higher.
3. Safe-Haven Demand
Global geopolitical tensions, high inflation, and economic uncertainty have prompted investors to shift money away from equities toward precious metals like gold and silver.
Silver is increasingly seen as both:
- An industrial metal
- A safe-haven investment
4. Weak Dollar Boosting Prices
International silver prices are denominated in US dollars. When the dollar weakens, silver becomes cheaper for non-dollar buyers, increasing demand.
- The Dollar Index (DXY) has fallen from around 109 to nearly 98, supporting higher silver prices globally.
Is This the Right Time to Invest in Silver?
Market experts remain bullish on silver’s long-term outlook:
- Motilal Oswal Financial Services expects silver prices to reach ₹3.20 lakh per kg in 2026, recommending buying on dips due to strong EV and solar demand
- Samco Securities believes silver could rise to ₹3.94 lakh per kg, citing a technical breakout and strong global cues
- Commodity experts suggest silver may touch $100 per ounce, translating to approximately ₹3.5–4 lakh per kg, driven by green energy demand and potential US interest rate cuts
- Global investors have also projected extreme upside scenarios due to inflation and dollar weakness
Overall, analysts suggest that long-term investors can consider accumulating silver during price corrections, rather than chasing rallies.
Best Ways to Invest in Silver
Investors can choose from multiple options depending on risk appetite and convenience:
1. Physical Silver
This is the most traditional method.
- Buy silver coins or bars from reputed jewelers, banks, or online platforms
- Always choose BIS hallmarked silver to ensure purity
- Downsides include storage risk and concerns over theft
2. Silver ETFs
Silver Exchange Traded Funds track the price of silver and trade on stock exchanges like shares.
- Requires a demat account
- No worries about storage or purity
- Ideal for investors looking for hassle-free exposure to silver prices
3. Silver Futures (MCX)
Silver futures allow investors to trade silver contracts on MCX.
- High leverage through margin trading
- Potential for higher returns, but risk is significantly higher
- Suitable only for experienced traders
Gold Also Hits Record High
Silver is not alone in this rally. Gold prices have also reached historic levels.
According to the Indian Bullion and Jewellers Association (IBJA):
- 24-carat gold rose by ₹540 to ₹1,32,317 per 10 grams
- Gold had earlier touched an all-time high of ₹1,42,152 per 10 grams on January 14
Gold Prices Surge 75% in 2025
Gold has delivered stellar returns over the past year:
- On December 31, 2024, 24-carat gold was priced at ₹76,162 per 10 grams
- By December 31, 2025, it climbed to ₹1,33,195 per 10 grams
- This marks a 75% annual increase, highlighting strong investor demand for precious metals
Conclusion
Silver’s rapid rise to ₹3 lakh per kg reflects a powerful combination of industrial demand, supply constraints, global uncertainty, and a weaker dollar. While prices are at record highs, experts believe the long-term outlook remains strong, especially with the global transition toward clean energy.
For investors, silver can act as both a growth asset and a hedge, but entry strategy matters. Buying gradually during market dips and choosing the right investment vehicle can help manage risks while benefiting from silver’s long-term potential.
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