Silver Reaches Record High in India as Spot Price Surpasses Rs 1.11 lakh

Silver prices in India reached unprecedented heights on Friday, surpassing Rs 1.11 lakh per kilogram in the spot market. This surge comes as investors flock to safe-haven assets amid escalating global trade tensions and expectations of a more lenient approach from the US Federal Reserve. On the Multi Commodity Exchange (MCX), silver futures also crossed the Rs 1.10 lakh mark during early trading, reflecting a significant increase in demand for this precious metal.

Record Highs in Silver Prices

In the physical markets, silver was traded at Rs 111 per gram, marking the highest domestic price ever recorded. This remarkable increase is part of a broader trend observed in global markets, where international spot silver prices rose by 0.4% to reach $37.19 an ounce, according to Reuters. This spike in silver prices represents the second consecutive session of gains for precious metals worldwide, indicating a strong investor sentiment towards these assets.

Kaynat Chainwala, Assistant Vice President of Commodity Research at Kotak Securities, noted that the surge in investor interest for silver is largely driven by strong inflows into exchange-traded funds and a renewed demand for safe-haven assets. This shift in market dynamics is attributed to rising geopolitical tensions and tariff-related risks, which have prompted investors to seek stability in precious metals.

Impact of US Trade Policies

Market sentiment took a hit following US President Donald Trump’s announcement of aggressive new tariffs, including a 35% tax on Canadian imports and a 50% levy on goods from Brazil, set to take effect on August 1. These tariffs are among the steepest introduced to date and have contributed to increased anxiety in global markets. Rahul Kalantri, Vice President of Commodities at Mehta Equities, explained that the recent gains in gold and silver were influenced by trade anxieties and speculation surrounding potential policy easing by the Federal Reserve.

Trump’s push for a significant rate cut has raised concerns about inflation, further boosting the demand for precious metals. The unpredictable nature of the President’s trade policies has added to the uncertainty in global financial markets, prompting investors to turn to silver as a more stable investment option.

Future Projections for Silver Prices

Looking ahead, Chainwala anticipates that silver prices on the MCX could test the Rs 1,14,000 to Rs 1,15,000 range, while COMEX silver may approach $40 per ounce in the near future. The market is also bracing for a potential new announcement from Trump regarding Russia, expected on Monday, which could further heighten geopolitical risks and impact market dynamics.

On Thursday, MCX September silver futures settled at Rs 1,09,123 per kilogram, reflecting a 1.73% increase, while gold August futures rose by 0.24% to close at Rs 96,691 per 10 grams. According to Prithvifinmart Commodity Research, the ongoing trade policy uncertainties have created a volatile environment for precious metals, which are expected to remain highly reactive in the coming weeks.

Technical Analysis and Market Sentiment

In global markets, silver has successfully breached the critical technical resistance level of $37 per troy ounce. Kalantri noted that the next resistance levels are between $37.40 and $37.55, with support identified at $36.60 to $36.85. Domestically, silver has decisively broken through resistance levels of Rs 1,09,950 to Rs 1,10,700.

Manoj Kumar Jain from Prithvifinmart highlighted that the heightened volatility in the dollar index and ongoing trade policy risks are likely to keep precious metals in a reactive state. He projected that silver would maintain support near $36.40, while gold is expected to hold firm above $3,280 on a weekly basis. As the market navigates these uncertainties, investors are advised to stay informed and prepared for potential fluctuations in precious metal prices.

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