Silver hits new high as gold-silver crashes 20 pc in one month

Silver prices in the Multi Commodity Exchange made a new high on Monday by crossing Rs 1.14 lakh per kg level. Gold-silver ratio has crashed 20 per cent in the past one month.

Domestic silver prices hit record high of Rs 1,14,763 amid sharp rally of over Rs 4,000 per kg in just three sessions. The rally was triggered by the bullish movement in the international market. COMEX silver climbed to $39.47, highest since 2011’s $50 mark.

“This bullish breakout follows renewed tariff tensions between the US and Canada, which have increased market uncertainty and driven demand for precious metals,” said Ajay Kedia, MD, Kedia Commodities.

The high gold-silver ratio in recent times also is working in favour of the white metal. The gold-silver ratio - the number of ounces of silver needed to buy an ounce of gold - has crashed 20 per cent from a peak of 107 on April 22 to 86.20—indicating strong silver outperformance.

Immediate resistance for silver is seen at $40 internationally and Rs 1,16,500 domestically, with support at $36.40 and Rs 1,10,000. The gold-silver ratio may find support near the 84 level, suggesting continued volatility but potential for silver to maintain its lead.

“Our view is the long-anticipated reversion in the ratio and projected silver's year-end target at Rs 1,30,000. However, caution is warranted following the Fed’s recent signal of no interest rate cuts in July and limited easing in September. This could cap further upside in the short term,” said Kedia.

Meanwhile, gold prices hovered around $3,350 per ounce on Monday, staying near a three-week high as investors sought safety following President Trump’s latest escalation of global trade tensions and the letters to the EU and Mexico. Traders now look to upcoming US inflation and activity data for clues on the Fed’s next steps.