Silver sheen continues on MCX, hits record high of Rs 1.06 lakh/kg in India: Here’s what’s driving the 9% weekly rally

Silver prices on MCX touched an all-time high of Rs 1,06,400 per kg on June 9, following a sharp global rally driven by a cocktail of bullish triggers from a weak US dollar to rising industrial demand. In the international market, silver crossed $36.5 per ounce for the first time in over a decade, gaining nearly 9 per cent in just one week outpacing even gold.

Global cues spark silver breakout

The surge in silver prices is largely being fuelled by bullish international sentiment. After consolidating below $35 per ounce for months, the white metal broke past key resistance levels last week.

A softer US Federal Reserve stance, coupled with a weaker dollar and safe-haven demand amid global macro uncertainty, has further lifted sentiment for precious metals.

Industrial demand gives silver an edge over gold

Unlike gold, silver derives significant value from its industrial applications. Demand has been steadily rising for use in solar panels, electric vehicles (EVs), semiconductors, and 5G infrastructure. This dual-use nature part precious metal, part industrial commodity, is why silver has managed to outpace gold in recent weeks.

Analyst Augmont’s report notes that silver continues to attract buying interest due to “looming supply constraints” and “a historically large discount to gold,” making it an appealing value proposition in a tight market.

Safe-haven rush, weak dollar adding fuel

The US dollar index has been trending lower, making dollar-denominated assets like silver cheaper for international buyers. At the same time, weak jobs data and softer economic indicators in the US have increased bets on delayed Fed rate hikes, pushing investors towards safe-haven assets.

While some easing in geopolitical tensions has dented safe-haven flows temporarily, silver’s fundamental strength as an industrial input is keeping the rally intact.

What’s next for silver prices?

Analysts believe the short-term trajectory will depend on upcoming US macro data. All eyes are now on the US Consumer Price Index (CPI) report and the Federal Reserve’s June 17–18 policy meeting. A hotter-than-expected CPI print could dampen hopes of rate cuts, strengthen the dollar, and potentially cap silver’s gains.

However, if the Fed sticks to a dovish tone, silver could comfortably test the $38 level globally, pushing domestic prices past Rs 1.11 lakh/kg.

With both industrial tailwinds and safe-haven flows at play, silver remains the metal to watch. The rally may have just begun.