Silver prices surged by Rs 1,500 to reach Rs 2.51 lakh per kilogram in the Delhi market on Tuesday, as ongoing geopolitical tensions continued to drive demand for safe-haven assets. The precious metal has been on an upward trajectory amid global uncertainties, with investors seeking refuge in traditional stores of value.
International Market Performance
In the international market, spot silver gained 1.08 per cent to trade at USD 73.51 per ounce. Meanwhile, gold prices also edged higher, with the yellow metal trading marginally up at USD 4,549.57 per ounce. The positive momentum in precious metals reflects sustained investor caution over geopolitical developments.
Factors Driving the Rally
Analysts attribute the rise in silver prices to several factors, including heightened geopolitical risks, inflationary pressures, and a weaker US dollar. The ongoing conflicts and trade tensions have prompted investors to diversify their portfolios with precious metals, which are considered a hedge against economic uncertainty.
- Geopolitical Risks: Persistent conflicts in various regions have fueled demand for safe-haven assets like silver and gold.
- Inflation Concerns: Rising inflation globally has led investors to seek assets that retain value over time.
- Weaker Dollar: A decline in the US dollar index has made dollar-denominated commodities cheaper for holders of other currencies, boosting demand.
Outlook for Silver
Market experts believe that silver prices could continue to rise in the near term if geopolitical tensions persist. However, they caution that any resolution of conflicts or a sharp economic recovery could lead to a pullback. Investors are advised to monitor global developments closely and consider their risk appetite before making investment decisions.
The domestic silver market in Delhi is expected to remain volatile, with prices influenced by international trends and local demand. The current level of Rs 2.51 lakh per kilogram marks a significant increase from previous sessions, reflecting the strong safe-haven appeal of the metal.
