Silver surge outpaces gold on global squeeze, rising interest rate-cut hopes
Mon Dec 01 2025
Silver jumped more than 2 per cent to a record high, with traders placing speculative bets on the white metal given ongoing supply tightness and rising expectations for an interest-rate cut in the US. Gold was steady.
Silver rose as high as US$57.86 an ounce, before paring some of its gains. The precious metal has risen for six consecutive days and doubled in value this year, outpacing a roughly 60 per cent rise in gold.
A record amount of the metal flowed into London in October to ease a historic squeeze in the world’s biggest silver trading hub. This in turn has put other centres under pressure: inventories in warehouses linked to the Shanghai Futures Exchange recently hit their lowest in nearly a decade, bourse data shows, and the cost of borrowing the metal over one month remains elevated.
“Shortages in the global market as a result of the recent squeeze in London are still being felt,” said Daniel Hynes, a commodity strategist at ANZ Group Holdings. “With gold taking a breather, it appears investors have turned their attention to silver.”
Silver, like gold, has also been boosted by increased expectations that the US Federal Reserve will cut interest rates this month. Markets are fully pricing in a quarter-point rate cut on continued weakness in the American labour market and a crescendo of dovish comments by Fed officials over the last week. The release of economic data delayed by the US government’s six-week shutdown has also supported the case for lower borrowing costs, which typically benefit non-yielding precious metals.
Investor interest in silver increased last month, with inflows to physically backed exchange-traded funds accelerating in recent weeks after investors booked profit in October following the previous high.
Silver’s latest surge “looks increasingly driven by speculative flow”, said Ahmad Assiri, an analyst from Pepperstone Group in Melbourne. “What I am seeing now is a market where strong investor inflows meet limited physical supply, creating a price dynamic that can accelerate quickly.”
Silver miners advanced on Monday. In Australia, Sun Silver was up almost 21 per cent at its peak and Silver Mines nearly 13 per cent, while Hong Kong-listed China Silver Group rose 14 per cent before paring some gains.
Global markets were also taking stock after an hours-long trading disruption on the Chicago Mercantile Exchange on Friday. With futures and options contracts on the Comex affected by a data centre fault, some metals traders said they had reverted to calling brokers and dealers by phone to hedge their exposures.
Silver rose 1.4 per cent to US$57.2892 an ounce as of 12.54pm, Hong Kong time. Gold was up 0.2 per cent at US$4,246.32. The Bloomberg Dollar Spot Index was steady. Platinum gained, while palladium was down slightly.
Source: https://www.scmp.com/