Silver climbed to a fresh record recently. iShares Silver Trust SLV has gained 97.3% so far this year (as of Dec. 2, 2025), outperforming SPDR Gold Trust GLD, which has advanced about 58%. The GLD ETF has advanced 5% over the past month, while SLV has surged 21.4% during the same timeframe.
Rising speculative positions, thanks to expectations of persistent supply tightness and the prospect of lower U.S. borrowing costs, led to the rally in silver prices. Below, we highlight a few reasons that can drive silver up in the near term.
Industrial Usage & ESG Transition
Silver is often considered an industrial metal. About half of the metal’s total demand comes from industrial applications. The industrial demand for silver is rising, especially on the green energy front. Silver’s industrial demand rose 4% in 2024, per the Silver Institute.
In the automotive industry, rising vehicle sophistication, the continued (though more gradual) electrification of powertrains, and sustained investment in supporting infrastructure will likely drive higher silver demand, per the Silver Institute.
Silver is used in solar power and electric vehicle applications. China’s solar boom greatly supported silver demand. The rollout of 5G globally is another positive for silver. The electronic components that enable 5G technology depend greatly on silver.
A Weaker Dollar in the Cards?
The Fed has enacted two rate cuts so far in 2025 and will likely cut interest rates further this year. There is an 89.2% chance (at the time of writing) of a 25-bp rate cut in December, per the CME FedWatch Tool. A softer labor market will probably lead the Fed to walk this path. Lower interest rates typically support non-yielding assets like silver and gold.
With Jerome Powell’s term ending in May, markets see growing chances for rate cuts ahead. If the Fed starts continued policy easing (albeit at a moderate pace), which could be the case ahead, given President Trump’s inclination for a lower rate and still-contained inflation rate amid tariffs, the U.S. dollar may lose strength.
Since silver is priced in the U.S. dollar, any slump in the dollar tends to buoy the metal’s prices. Invesco DB US Dollar Index Bullish Fund UUP is off 5% this year (as of Dec. 2, 2025) and has gained only 0.14% over the past month.
Higher Safe-Haven Demand
Since silver is also considered a precious metal, it offers some safe-haven appeal, though not as great as gold. With a moderate level of trade tensions around, the safe-haven metal silver has remained in a sweet spot this year.
ETF Holdings and Supply Constraints Add Further Momentum
Holdings in silver-backed exchange-traded funds climbed by roughly 200 tons on Tuesday, Bloomberg data showed, lifting total holdings to their highest level since 2022 — a sign of continued investor appetite, as quoted on Yahoo Finance.
Speculative flows have also intensified supply pressures. Inventories at warehouses tied to the Shanghai Futures Exchange have dropped to their lowest point in a decade, per Bloomberg, as mentioned on Yahoo Finance.
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SPDR Gold Shares (GLD): ETF Research Reports Invesco DB US Dollar Index Bullish ETF (UUP): ETF Research Reports iShares Silver Trust (SLV): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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