Entering the summer, "renewed selling pressure" sent silver below US$23, although by mid-July it was near US$25.

DiRienzo told INN that the decisions made this year by the US Federal Reserve have been at odds with the interests of investors, which has led to price sensitivity for silver.

While the Fed took a break from interest rate hikes at its meeting in June, Chair Jerome Powell has emphasized that more increases are likely in 2023. Many market participants are anticipating two more boosts of 25 basis points each.

“It's created heightened volatility in all financial markets, including precious metals,” DiRienzo said. “A lot of pain out there.”

Silver deficit of 142.1 million ounces expected in 2023

Looking further at silver market dynamics, DiRienzo said 2023 is set to be a record year for industrial demand.

Silver has benefited from the uptake of solar panel technology, investment in renewable energies, the rise of electric vehicles and ongoing 5G cellular service upgrades around the world, the expert said.

The white metal is benefiting in particular from demand from the solar energy industry.

“If you just go back to 2014, you look at photovoltaics, about 48 million ounces (of silver were) used then, and now we're projecting 161 million ounces in 2023,” DiRienzo told INN. “That's an over 230 percent increase.”

He added that silver also plays a key role in other major energy segments like wind and nuclear.

Overall the Silver Institute anticipates a deficit of 142.1 million ounces in 2023.

Investor takeaway

Silver’s characteristic price volatility has been at play in 2023, but experts remain optimistic about its future.

Many market watchers see the elusive US$30 level as a crucial point for silver to get through — speaking to INN in May, Don Durrett of GoldStockData.com said he thinks that would be a breakout point for the white metal.

It's also no secret that gold tends to move before silver, meaning silver may not take off before gold sees more price momentum. Although it's still historically high, the yellow metal has pulled back from the heights it saw earlier this year.

When silver does eventually move, it tends to outperform its sister metal gold.

"It's almost violent sometimes in how much it rises or falls, so if you have a rise in gold, silver's going to outperform it. We've seen this repeatedly throughout history," noted Jeff Clark of TheGoldAdvisor.com. "So if gold does rise, silver is going to follow it."