04/11/26, Silver fell to a near one-year low since November 2025 as investors weighed elevated oil prices, firm US economic data, and persistent inflation concerns, which have reinforced expectations that interest rates could stay higher for longer, supporting real yields and reducing the appeal of non-yielding assets like precious metals.

Spot silver fell to a low of around $48.63 per ounce on November 3 during the evening trade, but quickly recovered some gains to trade at $49.83 per ounce, marking a daily decline of 1.62 percent, a weekly decline of 8.37 percent, a monthly fall of 18 percent, though it's up 5.64 percent year-on-year. US gold futures price was down 1.97 percent to $49.88 per ounce on Comex from its previous close

 Domestic spot gold closed the Tuesday session at Rs 1,76,148 per kilogram on the Multi Commodity Exchange. MCX silver futures for December 4 delivery declined 2.17 percent to Rs 1,79,794 per kilogram (21:40 IST) over the past 24 hours.

Investors this week will focus on key US developments, particularly the US mid-term election, unemployment figures and Non-Farm Payrolls data, which could provide further clarity on the Fed's future policy stance.

At the same time, oil price trends, US inflation, Federal Reserve policy expectations, and the durability of industrial demand from technology, solar, and electrification-related sectors will remain key drivers.

Silver correction: A cyclical reset?

According to Kaynat Chainwala, AVP Commodity Research at Kotak Neo, silver's recent decline appears driven largely by macroeconomic headwinds and broad market deleveraging, not any meaningful deterioration in its long-term fundamentals. At the same time, the sharp correction in technology stocks has added pressure on silver given its significant exposure to industrial segments such as semiconductors, AI infrastructure, consumer electronics and solar manufacturing.

"As a result, silver has underperformed gold in recent weeks, with the gold-to-silver ratio rising to above 79, its highest level in nearly a year, reflecting the market's preference for the relative safety of gold amid heightened uncertainty," Chainwala said.

Despite weaker prices, the analyst estimates that the structural demand outlook remains intact, supported by global investment in solar energy, power-grid expansion, electrification, and electric vehicles, which continues to support a constructive long-term consumption story. "Therefore, the recent decline is more consistent with a cyclical reset than a change in the underlying demand narrative."

Key level to watch for silver

Analysts believe silver may be offering a more attractive entry point for long-term investors, but the road to recovery could remain volatile, with several macroeconomic and industrial factors likely to influence prices.

"From a market perspective, silver is now trading at levels that offer a more compelling entry point for long-term investors, although volatility is likely to remain elevated in the near term," Chainwala said.

He estimates that while the $47-50 per ounce region represents an important support level, investors should not assume a durable bottom has already formed. A sustained break below $47 could leave silver vulnerable to a deeper correction toward the $43-45 range, especially if elevated energy prices keep inflation expectations and bond yields under pressure, or if concerns over AI-related capital spending drive further weakness in technology-linked sectors.

"Conversely, any moderation in oil prices, easing in yields, renewed confidence in technology investment, or signs of a less restrictive monetary policy stance could help restore investor appetite and support a recovery over the coming quarters," Chainwala said.

How should investors approach silver now?

For long-term investors, the recent correction could offer an opportunity to gradually accumulate silver, rather than trying to time the market bottom.

"For investors, the recent correction has created an opportunity to build exposure at more attractive price levels. Rather than attempting to identify the exact bottom, a staggered accumulation approach is likely to be more effective given the current market environment," Chainwala said.

Silver's higher beta relative to gold means price swings can be substantial during both corrections and recoveries, but this same characteristic can also support stronger upside participation when macroeconomic conditions improve and investment demand returns. Investors with a three-to-five-year horizon and conviction in themes such as electrification, renewable energy, and infrastructure investment can use periods of weakness to add exposure incrementally.

"While further downside cannot be ruled out, the combination of a nearly 20 percent monthly correction and a gold-to-silver ratio above 79 suggests a significant amount of pessimism is already reflected in prices, improving the long-term risk-reward profile for patient investors. Gold should continue to serve as the core precious-metals allocation, while silver can be viewed as a higher-beta complement for investors willing to tolerate greater short-term volatility in pursuit of potentially stronger long-term returns,” Chainwala said.

Written by Dipen Pradhan

Source:Network18

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