HSBC-Silver Outlook Silvers golden chariot-20250808

Outlook: Silver charged higher to USD39.52 on 22 July, in sync with surging gold. Goldprices have been key to silver’s rally and will continue to be the main driver of prices.We believe high gold will continue to exert a gravitational pull on silver and keep it wellsupported and above levels the underlying fundamentals would otherwise imply. After fouryears of record increases, industrial demand is moderating but remains high. Key demandcategories including photovoltaic (PV) and electronics, as well as traditional industries,should see greater purchases in 2026. Coin & bar demand is undercut by previous robustpurchases and high prices. Jewelry and silverware are likely to weaken further due to highprices. Exchange-traded funds (ETFs) are accumulating at a solid pace. A weaker USDthis year, as forecast by HSBC research, is silver positive. Debate over the timing andextent of future Fed rate cuts and the policies of other central banks may impact silver.

Supply rising: Global silver mine output continues to rise at a modest pace aided byprimary and by-product output. High prices cannot stimulate greater production near termbut may help sustain output at marginal mines. Lower ore grades and mine closures will beoffset by new projects and expansions at existing facilities. Increased base metals and goldproduction will also boost by-product output. Mining costs remain well below prices. Pricesare an incentive to increase production wherever possible. Recycling levels are rising ashigh prices, as well as greater electronic and environmental recovery efforts, boost supply.