Silver breaks 46-year record, will its price reach Rs 2.50 lakh in 2026?

Silver has performed exceptionally well this year, rising by a staggering 120%. This surge pushed the price of silver past ₹200,000 for the first time in the domestic market on Friday. 

Significantly, silver has broken a 46-year-old record for this rise. This is the first time since 1979 that silver prices have seen such a surge. However, this golden glow for silver is unlikely to end here. 

Analysts predict that its price will reach its target of ₹240,000-250,000 next year – a further increase of 25% – driven by genuine supply constraints. Let's find out what experts have to say about this.

What are the reasons for the rise in silver prices?

Harshal Dasani, Business Head at INVAsset PMS, said in a Mint report that rising silver prices indicate a structural revaluation in the market, driven by physical scarcity and increasing demand. 

Global mining production has not kept pace with higher prices and has stagnated at around 810 million ounces, roughly the same or even lower than five years ago. Approximately 70-80 percent of silver is obtained as a byproduct of lead, zinc, and copper. 

According to Refinitiv data, the silver supply shortage is expected to persist until 2026, estimated at around 112 million ounces. The brokerage firm believes that industrial demand remains the mainstay of this bullish forecast. The solar photovoltaic (PV) sector has fundamentally changed the demand pattern.

Increase in industrial demand

According to the firm, industrial demand has increased, particularly due to the promotion of green energy. Silver demand from the solar energy sector has doubled over the past four years. 

Demand from 94.4 million ounces in 2020 is projected to increase to 243.7 million ounces in 2024. Solar energy alone will account for approximately 21% of total demand in 2024. 

Furthermore, the market is currently grappling with logistical imbalances caused by trade policy uncertainty. Throughout the year, COMEX futures have consistently traded at a premium to the London spot price.

What is the trend in the international market?

This arbitrage opportunity has aggressively pulled metal out of London, the world's primary liquidity center, and into US reserves, effectively reducing global float. Axis Direct reported that silver inventories are rising on Comex. 

On the technical charts, silver has decisively broken a decade-long low. The brokerage firm believes that consistent monthly closes above $67 could trigger a multi-year uptrend, targeting $76-80. However, the firm believes that consolidation near resistance around $65 is possible, but overall, the long-term outlook is bullish.

Will silver cross Rs 2.50 lakh?

Axis Direct believes that if the price of silver falls to the range of ₹170,000-₹178,000 in the domestic market, it can be used to buy silver in a phased manner, with a target of approximately ₹240,000 for 2026. 

On the other hand, Dasani said that the future outlook for silver remains strong. Due to physical scarcity, industrial demand, and renewed interest in investment, Dasani said that the price of the metal is not only rising but also undergoing a revaluation. This could lead to continued upward movement in 2026 and could reach ₹250,000.