India's Silver Imports Recover Strongly After May Slump

India's silver imports dropped to 1.5 million ounces in May but rebounded strongly in August, reaching 15.5 million ounces, according to Heraeus' analysts. This recovery suggests that demand for silver in India was not lost but rather delayed due to higher import duties and new licence rules introduced in May.

The domestic price of silver in India now exceeds the cost of importing it, which is a positive sign for silver holders over the next two to three months. The festival buying season starts on October 11, with Indian households traditionally purchasing precious metals during this time.

However, Heraeus notes that one risk is the below-average monsoon, which could affect rural incomes and potentially reduce demand for silver. China's silver market is not showing any signs of support, with a premium close to its tax level and increasing exchange stocks.