Silver Prices Near $59 as Geopolitical Tensions Drive Demand

Silver prices continue to rise as geopolitical uncertainty and physical supply constraints drive investors toward the precious metal. Spot silver gained 1.2% to $58.88 on Tuesday, outperforming gold in a market where traders are pricing in a 65% chance of a September Federal Reserve rate hike.

The shrinking inventories of physical silver are also contributing to its increasing value, with The Silver Institute forecasting a 46.3-million-ounce deficit in 2026. Reuters analysts project an average price of $71.90 for the metal next year, down from their previous forecast of $78 due to softer industrial and solar demand.

However, the analysts also note that emerging sectors such as artificial intelligence, electric vehicles, and renewable energy could provide long-term support for silver prices.