After the high platform volatility of silver prices at the end of December 2025, prices surged violently in January. According to the Commodity Market Analysis System of Shengyi Society, the silver market price on January 28, 2026 was 29184.67 yuan/kg, an increase of 57.93% from the peak spot price of 18480 yuan/kg at the beginning of this month (1.3).
The surge in silver today is driven by a triple resonance of financial attributes, supply-demand gap, and funding and technical aspects. The core is the strengthening of interest rate cut expectations, the outbreak of industrial demand, and the amplification of low inventory elasticity. as follows:
1、 Financial attributes: macro and hedging resonance
Expectations of interest rate cuts and weakening of the US dollar: US inflation and employment data have cooled down, and the market is betting that the probability of the Federal Reserve cutting interest rates in June will rise to 70%. The decline in real interest rates will lower the cost of holding precious metals; The US dollar index fell below 96 (a new low in nearly four years), and the attractiveness of silver denominated in US dollars increased, forming a double click of “interest rate cuts+US dollar depreciation”.
Gold linkage and gold to silver ratio repair: London gold has now broken through $5290/ounce, and the gold to silver ratio has dropped to 45.5 (the lowest level in nearly 13 years). Silver has sufficient momentum for replenishment, and funds have flooded into silver through the spillover effect of the gold bull market.
Geopolitics and risk aversion are heating up: The situation in the Middle East and the Red Sea crisis continue, and the risk of a US government shutdown is increasing. Investors are increasing their allocation of precious metals as a safe haven, driving up demand for allocation.
2、 Supply and demand fundamentals: structural gap continues to widen
1. Rigid constraints on the supply side
Starting from January 1st, China will implement a “single review” control on silver exports, reducing global supply by 4500-5000 tons (accounting for 60% -70% of global trade volume).
72% of silver comes from copper zinc associated mines, with an independent expansion cycle of 5-10 years. Mineral silver is expected to decrease by 0.6% year-on-year in 2026, marking the fifth consecutive year of decline.
Extremely low inventory: LBMA deliverable inventory is only 233 tons, COMEX inventory has decreased by 70% year-on-year, and global explicit inventory only covers 1.2 months of consumption, with tight spot supply supporting premium.
2. Explosive growth on the demand side
Photovoltaic: The global installed capacity is expected to reach 600GW by 2026, and the penetration of N-type batteries will increase silver consumption to 210 million ounces, accounting for 34% -55% of industrial demand. Domestic replenishment orders are scheduled until mid February.
AI and New Energy: Silver used for packaging AI server chips increased by 35% year-on-year, silver used for power batteries in new energy vehicles increased by 28% annually, and “silver for copper” added 300000 to 500000 tons of replacement demand.
The supply-demand gap is widening: The global gap is expected to reach 203 million ounces (approximately 6316 tons) by 2026, marking the sixth consecutive year of shortage.
3、 Financial and technical aspects: emotional and financial resonance
Accelerated capital inflow: Silver ETF increased its holdings by 210 tons in January, with multiple positions in the futures market reaching a historic high, and speculative funds taking advantage of the situation to chase higher prices.
Technical strengthening trend: Long positions on the daily chart, Bollinger Bands opening upwards, prices moving along the upper track without significant deviation, triggering trend tracking funds to enter the market.
Futures and spot structure support: spot premiums continue to rise, with futures leading the gains and spot prices rebounding. Low inventory amplifies price elasticity, making short-term gains difficult to fall.
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