Silver Price Update: Q1 2026 in Review

Much of silver's gains for the month of January were wiped out on February 2, with the white metal falling by 35 percent from its peak to US$71. The rapid decline came on the back of US President Donald Trump’s nomination of the hawkish Kevin Warsh to replace Jerome Powell as chair of the Federal Reserve.

However, by February 11 the price of silver had regained some ground, rising back up to the US$86 level. Much of the rest of February saw silver see-saw amid significant price swings.

The metal was back down to US$78.24 by February 18, and then back up to US$94.14 on February 27.

The first half of March brought more stability to the silver price as the metal for the most part stayed trading in the US$82 to US$88 range. But the second half of the month was a different story. By mid-March, silver had once again encountered a steep downward trend as the US-Iran war’s impact on oil prices and inflation began to dampen demand for precious metals. By the March 23 trading session, silver had fallen as low as US$61.

At the close of the month, silver had climbed back up to US$75.15.

US-Iran war, Fed rattle silver market

Even more so than his first term in office, Trump has become a wild card in geopolitics and the global economy.

Whether it be capturing heads of state in Venezuela, threatening the annexation of Greenland, sparking a worldwide tariff war or warring with Iran and the Fed, the decisions made by the White House have had an oversized impact on commodities markets since Trump took the helm in the US again.

Early in Q1, his feud with the Fed stoked concerns over the central bank's independence and raised expectations of lower interest rates, both of which weakened the US dollar and strengthened safe havens.

Prior to the breakout of the US-Iran war, silver was on a clear path into triple-digit territory, with calls that the metal could go even higher by the end of the year. It seemed certain that the Fed would see fit to lower rates in the second half of the year on a weakening labor market, rising national debt and an inflation rate within sight of its target.

Even though Trump’s nomination of Warsh as the next Fed head caused a course correction for silver in early February, the consensus among analysts was that the Fed would have no choice but to lower rates. The prevailing view was that gold and silver’s deep price correction at the time was a normal and healthy event in the next leg of the current bull cycle, and that both metals would quickly regain that ground in the weeks and months ahead.

Throwing a wrench in the works was another event happening at the same time — namely the escalation of tensions between the US, Israel and Iran, which broke out into a full-on regional war in the Middle East in early March.

At first, the geopolitical upheaval sent investors flocking to gold and silver as safe-haven assets, pushing silver back up near triple-digit territory. However, the price spikes were short-lived — profit taking soon set in, as did rising oil prices once the conflict began impacting shipping through the Strait of Hormuz.

Rania Gule, senior market analyst at XS.com, sees the geopolitical forces playing out in the Middle East as the most complex factor currently impacting the silver sector.

“In theory, such tensions should boost demand for safe-haven assets, including silver. However, the current reality presents a clear paradox: precious metals are not fully benefiting from these conditions,” explained Gule in a late March note on the market shared with the Investing News Network (INN). “In my view, the primary reason lies in rising energy prices, which in turn influence global monetary policy expectations. As inflation increases due to higher energy costs, central banks become less inclined to cut interest rates and may instead maintain tighter policies for longer.”

As oil is priced in US dollars, this strengthened the greenback, making gold and silver more expensive for international buyers. At the same time, the risk of higher inflation the longer the war drags on caused the Fed to hold rates steady for the second time this year, also putting to rest any notion of rate cuts in 2026.

The perfect storm set gold and silver prices on course for another historic single-day slide on March 23.

“This shift in monetary expectations places direct pressure on silver, as it is a non-yielding asset. In such an environment, investors tend to favor income-generating assets like bonds or even the dollar itself over precious metals,” said Gule. “As a result, I see silver currently caught between two opposing forces: theoretical support from geopolitical tensions and tangible pressure from tight monetary policy.”

Short-term pain for long-term gain?

On the flip side, Chen Lin of Lin Asset Management sees the current silver price environment as one of short-term pain for long-term gain. Speaking during the Silver in Focus roundtable discussion, presented by INN during the March Kinvestor Mining & Energy Virtual Investor Conference, Lin explained that one of the purposes of precious metals like silver is to store wealth in order to buy what you need in times of an emergency.

“In the short term, as we see war goes on, people will sell gold ... to feed (their) family,” he said. “(This is) especially true in Dubai, especially true in India. In India we see the biggest selling ... because they depend on Middle East oil and gas and they need to feed themselves — they don't even have fertilizer for the spring (planting season)."

The elephant in the room for Lin is the US$39 trillion US national debt, which continues to grow at a rate of US$2 trillion per year. In his view, the US-Iran war will increase that debt load, and the interest paid to service that debt will also increase, placing further pressure on the Fed to lower rates down the road.

“This will really benefit gold and silver in the long run,” said Lin.

Silver's growing industrial uses

Although its value as an investment metal has grown in recent years, silver’s industrial demand has skyrocketed as well. The white metal's exceptional electrical and thermal conductivity make it highly suited for a vast number of uses in modern technology such as solar panels, artificial intelligence (AI) infrastructure and electric vehicles.

Peter Krauth, editor of Silver Stock Investor and Silver Advisor, also participated in the Silver in Focus roundtable, where he shared his thoughts on how new industrial uses for silver are shaping the investment thesis for the metal.

Krauth pointed out that over the past five years, silver demand from industrial uses has climbed a full third, rising from 50 percent to about 65 to 67 percent. “In types of applications, silver is the second most-used commodity after oil. It has something like 10,000 different applications,” the expert explained.

“The interesting thing to point out is not only is industrial demand requiring more, but what that does is it squeezes out the available silver for investment demand,” he added. “So if you think about five years ago, when half of silver went to industry, the other half was available for investment. Now today only a third is available.”

This scenario has been price positive for silver, and explains how the January high occurred as silver investment increased rapidly and squeezed demand, Krauth told listeners at the online event.

On the other hand, as an industrial metal, the silver price is also subject to the whims of market drivers behind the sectors it services. “(Silver’s) price movements remain more sensitive to economic fluctuations compared to gold, given its dual role as both an investment asset and an industrial metal,” said Gule.

For example, hits to AI sector in February, which brought a dramatic drop in the share price values of chipmakers and AI tech firms, also added downward pressure to the silver price.

In addition, higher silver prices over the past year have increased manufacturing costs for solar panel makers, leading the firms to look for alternatives such as copper, or to pursue thrifting, a practice that involves limiting the amount of silver used in the manufacturing process.

Silver supply deficit in sixth straight year

On the supply side, silver is in a multi-year deficit, and it takes about a decade to bring a new silver discovery through to production. Released in February, the Silver Institute's latest forecast, based on analysis by consultancy Metals Focus, projects a 67 million ounce silver shortfall in 2026, with total demand outstripping total supply.

This deficit is why some of the world’s biggest economies have designated silver as a critical mineral.

As of January 1, China has expanded its restrictions on silver exports in an effort to secure domestic supply for key industries. China is the world’s second largest silver producer, producing 3,400 metric tons of the metal in 2025. The Asian naion also hosts the third largest silver reserves at 67,000 metric tons.

Last year, the US added silver to its critical minerals list, citing the precious metal's important role in manufacturing advanced energy and defense technologies. While still among the 10 largest silver-producing nations, US production amounted to 1,100 metric tons last year, up only 50 metric tons from the previous year. At the same time, the country imported 7,600 metric tons of the metal compared to 4,430 metric tons in 2025.

For Alex Ebkarian, co-founder of Allegiance Gold, the move to secure domestic silver supply speaks to the positive long-term outlook for demand and a higher silver price. “Yes, we have some structural deficits. Yes, we have more demand than available supply,” he said in a March interview with INN. “When silver was added, (as a) critical metal here in the US, that was not a noise — that was a signal that we need it, and we want to control it.”

Silver price forecast for 2026

Silver had a fantastic start to the year, and despite the current volatility in the market, as of April 1 the metal was still trading up 130 percent over the same period last year.

What does the remainder of the year hold for the silver price?

”I think silver this year will challenge the three-digit level. We could very well see another US$100 level,” said Ekbarian. “I think the fundamentals are still there. It was good for silver to have a little bit more retraction so that way we can solidify and have more of a tested level, as opposed to this wild ride.”

Commerzbank (ETR:CBK,OTCPL:CRZBF) is forecasting that silver will be at the US$90 level by year end, and US$95 by the end of 2027. UBS Group (NYSE:UBS) is more conservative, projecting the white metal will average $85 by the end of 2026. For its part, Deutsche Bank (NYSE:DB) is more bullish, with an eye toward US$100 by the end of the year.

For her part, Gule sees the silver price battling volatility in the near near term, with some support if the dollar loses some steam. “However, I only see the potential for a strong and sustained uptrend if one of two conditions is met: either a clear shift toward more accommodative global monetary policy, or a sharp geopolitical escalation that drives investors collectively toward precious metals,” she added.