A report from the "Safe Haven" research center shows that silver prices in local markets rose by 9% last week. Globally, the price per ounce increased by 7%, closing at its highest level since August 2011. This surge was driven by a weaker U.S. dollar, rising industrial demand, and growing expectations that the U.S. Federal Reserve will pursue further monetary easing.
Locally, the price of 800-karat silver gained about EGP 5, opening the week at EGP 55 and closing at EGP 60. The price of 999-karat silver reached EGP 75, and 925-karat silver was around EGP 70, while the price of a 925-karat silver pound remained stable at EGP 560.
Globally, the price per ounce jumped by about $3, from $43 to $46, marking its highest level in 14 years. This was supported by increased demand for safe havens and rising bets on U.S. interest rate cuts, which boosted the appeal of non-yielding assets, especially silver.
Year-to-Date Gains
The report noted that local silver prices have gained 46.3% since the beginning of the year, an increase of EGP 19 per gram, rising from EGP 41 to EGP 60.
Globally, prices have soared from $29 to $46 per ounce, a $17 increase equivalent to 59%, making silver one of the best-performing precious metals in 2025.
Historical Perspective: A Rare Price Doubling
The report explained that a doubling of silver prices in four years is an exceptional event, having occurred only six times since 1973. In most of these past instances, this performance was a signal of the beginning of a long-term uptrend, not just a temporary peak.
Periods where silver gains exceeded 100% over four years were associated with an average cumulative annual return of about 19.5%, a rate that surpasses the performance of most other metals during stable periods.
However, the report warned that silver hasn't always maintained its gains after every doubling wave. It cited the example of 2006 when prices fell by about 33% after a strong rally, despite achieving gains of over 100% in the preceding period.
At the same time, the report sees the current 38% increase over the past year as not excessive compared to historical waves, indicating a relatively healthy and sustainable momentum.
The report also observed that silver recorded 21 price peaks over four years in the past year, a pace that shows an underlying driving force behind the upward trend, reinforcing the hypothesis that the market is entering a continuous structural uptrend.
Lessons from the 1980 Peak
The report recalled the experience of January 1980 when silver prices surged to nearly $50 per ounce, driven by factors similar to today's, including:
Double-digit inflation in the U.S. exceeding 13%.
The oil price shock following the Iranian Revolution.
A weak U.S. dollar, which pushed investors toward hard assets.
Intense speculation, most notably by the famous "Hunt" family.
Although that rally ended quickly, it highlighted that a mix of high inflation, geopolitical risks, and a loss of confidence in fiat currencies is a perfect environment for silver prices to explode—conditions that are re-emerging in 2025.
Current Factors Driving Silver's Rise
Inflation Hedge: Despite interest rate hikes, inflation remains "stubborn," making silver an effective tool to preserve purchasing power against currency erosion.
Strong Industrial Demand: Silver is widely used in solar panels, electric vehicles, and electronics, which boosts demand and adds an industrial dimension to its monetary role.
Geopolitical and Currency Risks: Trade wars, central bank disagreements, and escalating political tensions weaken confidence in fiat currencies and encourage a shift to hard assets.
Gold's Influence: Gold's breakthrough of the $3,700 per ounce barrier paved the way for silver's rise. Historically, silver tends to follow gold's direction but with higher volatility and faster gains.
Will Silver Break the $50 Barrier?
The report believes that a breakthrough of the $50 level would be a symbolic and strategic signal, confirming investors' shift toward tangible assets to hedge against inflation, debt, and financial volatility.
History shows that silver's movements are typically fast and sharp. In the 1979-1980 rally, it jumped from $30 to $40 in three weeks, then to $49.45 in less than two weeks—a 24% increase in a short period.
The scene was partially repeated in 2011 when it rose from $30 to $48 in three months. Therefore, if silver breaks the $50 barrier, the rise will likely be quick and temporary before a correction.
Current Factors and Future Scenarios
The center believes the current rise to $46.5 per ounce is not just based on speculation but on a convergence of three main forces: accelerating industrial demand, persistent inflationary pressures, and economic and geopolitical uncertainty.
Prices are likely to follow one of two scenarios in the near term: either breaking the historical level soon or a temporary correction preceding a new rally. The report notes that silver remains an asymmetric bet in the markets, thanks to its limited risks, monetary role, and strong upside potential driven by industrial demand.
Impact of Monetary Policy and Global Economy
The report pointed out that the recent start of interest rate cuts by the U.S. Federal Reserve, with the potential for further reductions this year and next, is a positive factor for both gold and silver. It reduces the cost of holding non-yielding assets and increases their investment appeal compared to bonds and cash returns.
This trend also weakens the U.S. dollar and strengthens the position of metals as a hedge against currency devaluation.
Additionally, fears of stagflation are drawing investors' attention to silver and gold as safe havens amid increasing economic uncertainty, including U.S.-China relations and the performance of the Chinese economy itself.
Industrial Demand and Market Challenges
The report explained that silver's price volatility might be higher than gold's due to the smaller market size but confirmed there are no real risks of supply shortages in key industries like photovoltaics.
While industrial demand is not at its peak right now, especially in the third quarter which typically sees seasonal activity in electronics, tariffs and trade uncertainty have led to some deferred orders. The Chinese market also saw an early peak in the first five months of the year, supported by government subsidies that later ended.
Future Outlook
The "Safe Haven" center predicts that macroeconomic and geopolitical factors will continue to push silver prices up for the rest of the year and into next year. It suggests that the price will likely exceed the $50 per ounce level in 2026, which could prompt solar energy companies to reduce their use of silver to contain costs.
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