Precious Metals Quarterly

Silver Quarterly Update!!!

Navneet Damani: Head Research - Commodities and FX Manav Modi: Bullion Analyst
navneet.damani@motilaloswal.com manav.modi@motilaloswal.com
2025
11-03-2025
Silver: Introduction
MCX Silver Returns 105000 Silver Price Comex v/s MCX 34
50% 46%
100000
40% 29
95000
30%
20% 22%
90000 24
20%
11% 12%
10% 7% 85000
19
0% 80000
-1%
-10% 75000 14
-8%

Apr-24

Sep-24

Oct-24

Nov-24
Jul-24

Jan-25

Feb-25
Aug-24
May-24

Jun-24

Dec-24
-20%
2018 2019 2020 2021 2022 2023 2024 YTD MCX Silver Comex Silver RHS
Source: Reuters Source: Reuters

150 Silver v/s Gold and Copper (Jan’24=100)

Correlation against Silver and Returns ($)
140
Correlation (2024) YTD Gains
130
Silver ($) - 11.7% 120
Gold ($) 96% 12.1% 110
Copper (LME) 83% 8.2% 100
Crude ($) -65% -1.3% 90 LME Copper COMEX Gold COMEX Silver (RHS)

Dollar Index -78% -1.7% 80

Mar-24

Apr-24

Oct-24

Jan-25
Jul-24
Jun-24

Aug-24
May-24

Dec-24
Sep-24

Nov-24

Feb-25
Nifty -41% -4.6%

Source: Reuters Source: Reuters 2025

Fed, Inflation & Growth!!!
Inflation: Hovering near central banks target levels Major economies continue to cut; while Fed pauses
Inflation Trends of Major economies (Mar'22=1) Interest Rate of Major Economies (%)
2
6 7
1.5
5 6.5
1
4 6
0.5
3 Fed 5.5
0 ECB
2 5
-0.5 BOE
1 RBI (RHS) 4.5
-1
Mar-23
Mar-22

Mar-24
Jul-22

Jan-23

Jul-23

Jan-24

Jul-24

Jan-25
May-22

May-23

May-24
Sep-22
Nov-22

Sep-23
Nov-23

Sep-24
Nov-24
0 4

Mar-23
Mar-22

Jul-22

Jul-23

Mar-24

Jul-24
Jan-22

Jan-23

Jan-24
May-22

May-23

May-24

Jan-25
Sep-22
Nov-22

Sep-23
Nov-23

Sep-24
Nov-24
US CPI UK CPI India CPI China CPI
Source: Reuters
Source: Reuters
Steady Growth outlook amidst higher uncertainties Mixed views on the rate cuts probabilities
IMF Global Growth Forecast (%): Fed interest rate probabilities (%) Current Rate: 425-450
3.5 3.2 3.2 3.2 3.2
3.1
2.9
350-375 375-400 400-425 425-450
2.5
3/19/2025 - - 7.00% 93.0%

1.5 5/7/2025 - 2.5% 38.2% 59.2%

6/18/2025 1.6% 24.6% 51.2% 22.7%

0.5
Oct'23 Jan'24 Current Projections 7/30/2025 8.5% 32.5% 42.6% 15.9%
2024 2025
Source: cmegroup 2025
Source: IMF
China and its impact on Silver
Social financing continue to rise, signalling growing money supply Chinese inflation slowly and steadily coming back to life
600 Social Financing China CPI Y/Y
2.5
500 2

400 1.5
1
300
0.5
200 0
-0.5
100
-1
Trillions

Mar-23

Mar-24
Jan-23

Jul-23

Jan-24

Jul-24

Jan-25
May-23

Nov-23
Sep-23

May-24

Sep-24

Nov-24
-
2006
2002

2004

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026
Source: Reuters Source: Reuters

10% fall in China’s Reserve Requirement Ratio in last 8 years China shows significant potential for higher Silver demand
20 China Reserve Requirement Ratio (%) China Solar Module exports, Units: GW
30
18
25
16
20
14
15
12
10
10
5
8
Apr-16

Apr-21
Oct-18

Oct-23
Mar-19
Jan-15
Jun-15

Jan-20
Jul-17

Jun-20

Jul-22
Aug-19
Nov-15

Sep-16
Feb-17

Dec-17
May-18

Nov-20

Sep-21
Feb-22

Dec-22
May-23

0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Source : Reuters 2023 2024
Source: silverinstitute
2025
Green Technological Advancements
Silver Demand for Solar on the Rise Global electric vehicle sales increase with a significant pace
Silver and Solar Global electric vehicles sales 2014-2024 ($ millions)
18
500 250
16
400 200 14
300 150 12

200 100 10
8
100 50
6
0 0 4
2016 2017 2018 2019 2020 2021 2022 2023 2024 2
Annualgrowth for silver used in PV (Moz) (RHS) 0
Solar PV electricity additions (GW, accelerated case) 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Source: silver institute Source: silverinstitute

Silver’s industrial demand expected to support demand story Silver demand in Electronics market expected to rise
Silver's industrial demand 80 Printed and Flexible Electronics Market Silver Demand
150
70
60
100
50
40
50 30
20

0 10
2023E

2024E

2025E

2026E

2027E

2028E

2029E

2030E
2017

2018

2019

2020

2021

2022

2024 F
2025F
2026F
2027F
2028F
2029F
2030F
2016
2010
2011
2012
2013
2014
2015

2017
2018
2019
2020
2021
2022
2023
Automotive Electrical Solar
Source: CRU Source: silverinstitute
2025
Silver Demand and Supply
Steady total demand; rise in industrial demand Silver Recycling is expected to increase by 5%
Silver Industrial Demand Silver Recyclying Supply
230
750 1300
210
700 1250
Total Demand RHS 190
650 1200
Industrial Demand 170
1150
600 150
1100 130
550
1050 110
500 1000 90
450 950 70
400 900 50

2025F
2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025F
2013

2023
2012

2014

2015

2016

2017

2018

2019

2020

2021

2022

2024
Source: silverinstitute Source: silverinstitute

Demand for jewellery is expected to decline by 6% in 2025 Market Balance expected to be in deficit for the fifth year
1400 Silver Supply and Demand 100
350 Silver jewellery and Silverware Demand
1200
300 0
1000
250 800
-100
200 600

150 400 -200

200
100
0 -300
50

2025F
2024
2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023
2020
2012

2013

2014

2015

2016

2017

2018

2019

2021

2022

2023

2024

2025F

Total Demand Total Supply Market Balance(RHS)

Source: silverinstitute Source: silverinstitute 2025

Silver Flows
2024 Domestic Silver imports surpassed last years inflow Silver Ishares steadies after sharp swings in the previous years
India Silver imports (tonnes) Silver ishares

12000 20000

10000 18000

8000 16000
6000 14000
4000
12000
2000
10000

Jan-20

Jan-21

Jan-22

Jan-23

Jan-24

Jan-25
May-20

May-21
Sep-20

Sep-21

May-22
Sep-22

May-23
Sep-23

May-24
Sep-24
0
2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025*
Source: metalsfocus
Source: Reuters

Significant jump in Silver AUM of major mutual funds in India Managed net position for Silver shows strength in sentiment
50000 Silver Manages net Position
12000 Silver AUM in Indian ETF (in Cr)
40000
10000
30000
8000
20000
6000
10000
4000
0
2000
-10000
0

Jun-24
Mar-24

Apr-24

Jul-24

Oct-24
Jan-24

Jan-25
Aug-24
Feb-24

May-24

Sep-24

Dec-24
Nov-24
Jan-22

Apr-23
Jun-22

Jul-24

Dec-24
Nov-22

Sep-23

Feb-24

2025
Source: Bloomberg, MOFSL Source: Reuters
Fundamental Pointers

• Silver has experienced sharp volatility, with a ~12% YTD upside

• Geo-political tensions and Trump’s tariff threats are boosting silver’s safe haven appeal

• Rupee has depreciated more than 3% since Diwali 2024, supporting domestic silver

• Mixed outlook on US interest rate is keeping investor on the edge

• Weak US economic data is also supporting precious metals pack

• Fall in the dollar index and a rise in industrial metals are contributing to silver's strength

• Supply-demand dynamics have significantly impacted silver price fluctuations over the past few quarters

• Recovery expectations in China are positively influencing silver price sentiment

• Rising investment and industrial demand are providing a boost to silver prices

• US-China trade war and geo-political tensions are increasing the safe haven appeal for silver

• Potential global growth slowdown could fuel interest in longer run

• Significant jump in Silver domestic imports in 2024 of more than 5000 tonnes and ~1000 tonnes at start of 2025 is supporting sentiment

• Demand from green tech - i.e. Solar energy, EVs, 5G tech continue to paint a positive picture for silver over the next few quarters.

2025
Outlook

Parity Price of Silver in Rupees at various dollar levels

Silver in
$ 28 30 32 34 36 38 40 42
Rs/$

84 79840 85543 91246 96949 102651 108354 114057 119760

85 80791 86561 92332 98103 103874 109644 115415 121186

86 81741 87580 93418 99257 105096 110934 116773 122611

87 82691 88598 94505 100411 106318 112224 118131 124037

88 83642 89616 95591 101565 107540 113514 119488 125463
89 84592 90635 96677 102719 108762 114804 120846 126889

90 85543 91653 97763 103874 109984 116094 122204 128314

M o st P ro bable path A lternative levels o n weaker USD:INR co rrelatio n to go ld

• We continue to reiterate our view on a medium to long term perspective

• Supports are near ₹86,000- 87,500; for targets towards ₹1,11,111 and ₹1,25,000 on domestic front & assuming USDINR at 87: $37.5
and $42.2 on Comex

• Buying on dips is recommended from a 12-15 month perspective.

2025
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2025