Silver’s dramatic rally that smashed records and squeezed short sellers came to an end as it fell to $73, after peaking at $83.62 on Monday(Dec 28, 2025). The precious metal has been climbing steadily this year, more than doubling its value.
Compared to the silver price on December 28th 2024 (closed at $28.72), with its historic high on December 28th 2025 ($83.62), the metal has performed a spectacular jump of 191%+.
What drove Silver’s Unprecedented 191% + Rally in 2025
Although silver has retreated from its peak of $83.62, the value still lingers around $73, which is still a 154% jump from last December’s price. Although the fleeting spike can be mostly attributed to the short covering panic, the rest of the rally is driven by concrete real-world factors:
Empty COMEX Warehouses
The world’s silver trading hub, COMEX, saw a 50-year low in its silver supplies. COMEX registered around an 80M oz deliverable silver supply in late November and is claimed to have a massive 4-day drain where 47.6M oz was pulled, leaving less than 33M oz of silver. 2025 witnessed similar dramatic drains of physical silver from vaults around the world. Around 43% of China’s silver inventories in the Shanghai vault were drained in a mere 2 weeks in late October. This steady rise in demand for silver supplies is one of the primary driving forces behind the rally.
Solar, EV, and AI Demand Surge
Industrial demand for silver has been rising for the past decade, owing to the spread of solar panels and traction gained by EVs in the automotive industry. Additionally, most governments support the electric product industries that decrease reliance on fossil fuels. The domestic solar farms in the USA doubled owing to the IRA subsidies. Silver is an essential component in solar panels and electric car batteries.
AI data centres have drawn criticism for their enormous amount of electricity consumption. Yet, big players like AWS continue to build massive data centres, which require NVIDIA/AMD chips. And silver is used for ultra-conductive plating in these chips. This has further overwhelmed silver reserves and supply chains.
Also Read: XRP Price Projection if It Reaches Silver’s $4.48T Market Cap
Fed Rate Cuts Spark Inflows into Silver ETFs
The Fed’s recent interest rate cut reduced the opportunity cost for holding unyielding investments such as gold and silver. This resulted in investors flocking to silver, rendering huge inflows into silver ETFs.
Silver as a Safe Haven Amid Geopolitical Chaos
Gold and silver have shown similar patterns of surges during geopolitical uncertainty. The escalations in Ukraine and the Middle East flare continue to have a considerable impact on the valuation of safe-haven investments. Gold has also shown a ~70% YTD, fueled by political instability around the world.
Trump’s Tariffs on imports from Canada, Mexico, and China also led to Wall Street scrambling to silver as insurance from global trade wars that could ensue. Mexico and China are the biggest silver producers in the world, as they together account for 38% of all of the world’s silver production. Trump announced tariffs of 25% on Mexico and 10% on China on February 1st, which led to a 3% jump in silver in the following week- a safe-haven rush that amplified the rally.
