Silver Hits Record High: Rally Or Repeat Of 1980 And 2011 Collapse? | Economy News

Silver’s industrial demand may sustain its current rally.

Silver has emerged as the most talked-about metal globally this year. From bullion markets to trading forums, it is at the centre of every financial conversation. On the Multi Commodity Exchange (MCX), silver recently touched an all-time high of Rs 1,70,415 per kg, while in the US, it surged to $54.46 per ounce.

This sharp rise has triggered intense debate, is this the beginning of a long-term bull run or a repeat of previous speculative bubbles?

Echoes of 2011 and 1980 Resurface

Market veterans are drawing parallels with 2011, when silver prices climbed to nearly Rs 71,000 per kg, sparking predictions that it would cross Rs 1 lakh. Instead, within months, prices crashed to below Rs 40,000. Internationally, silver plummeted from $49.83 to $26 per ounce, revealing how market sentiment, rather than fundamentals, often drives such meteoric rallies.

Similar scenes played out in 1980. The Hunt Brothers in the United States attempted to corner the global silver market by purchasing vast quantities of the metal. Prices soared from $6 to $48 per ounce before regulatory crackdowns by COMEX and the US government triggered a dramatic collapse, an event still remembered as “Silver Thursday”.

The 2025 Rally: Different or Destined to Burst?

In 2025, silver has once again captured investor imagination, jumping from nearly Rs 1.5 lakh to Rs 1.70 lakh per kg in a short span. A blend of festive buying around Diwali, speculative trades and digital investment platforms has fuelled the rally. Physical silver purchases have intensified, with jewellers reportedly charging up to 10% above the spot price. Social media and trading groups are abuzz with “silver to the moon” slogans.

The surge in demand is also evident in financial markets. Silver Exchange Traded Funds (ETFs) and Fund of Funds witnessed such high inflows that some fund houses temporarily halted new subscriptions.

Yet, the euphoria has been tempered by volatility. Within days of hitting record highs, prices corrected to nearly Rs 1.53 lakh per kg, a sign, analysts say, that the market is catching its breath.

Why Analysts Say This Time Might Be Different

Market experts caution against drawing simplistic comparisons with past bubbles. Unlike in 1980 and 2011, they argue, silver now has strong industrial relevance. Its use in solar panels, electric vehicles, batteries and advanced electronics has surged due to global pushes for clean energy and electrification. Silver is no longer merely a precious metal, it is a critical industrial commodity.

However, experts also warn that any asset which reaches the “everyone is buying” stage demands caution. Technical charts indicate overbought levels, suggesting that while demand is robust, speculative excess cannot be ignored.

What Should Investors Do?

Silver’s glitter is undeniably hard to overlook. But history shows that when prices rise too fast, markets can turn unexpectedly. Analysts advise investors to avoid impulsive buying driven by fear of missing out (FOMO). Instead, they recommend:

• Investing gradually rather than in lump sums.
• Preferring verified purity in physical or digital forms.
• Adopting a long-term perspective instead of chasing short-term gains.

Silver’s story in 2025 is still unfolding. Whether this rally strengthens into a sustained uptrend or becomes another cautionary tale will depend on a delicate balance of industrial demand, investor emotion and global economic stability.