Gold and silver prices in India are currently trading near record highs amid the Diwali festive season. The MCX gold rate has surged close to ₹80,000 per 10 grams, while silver prices are approximately ₹99,000 per kilogram, after briefly crossing the ₹1,00,000 mark earlier this month.
Gold has delivered a substantial return of over 33.5% since Dhanteras last year, rising by more than ₹20,000 per 10 grams. Silver, however, has outperformed gold over the same period, with a remarkable rally exceeding 40.5%.
In India, buying precious metals like gold and silver during Diwali is considered auspicious, and this tradition has spurred a notable increase in retail demand nationwide. Given that silver has outpaced gold in terms of returns over the past year, the question arises: will this trend continue in the upcoming Samvat year 2081?
In the last two years, silver has given more returns than gold, data shows. Analysts expect both gold and silver to continue their record-breaking rally next year.
“We are more bullish on silver for the upcoming two-three years period. Silver prices are fundamentally and technically well-placed to outperform gold going ahead in the light of several factors. While gold prices may see a decent rally in the near-term, investors may have to remain cautious on the yellow metal in the second half of 2025,” said Ajay Kedia, Director, Kedia Advisory.
According to Kedia, silver prices are poised to exceed $70 per ounce in the next 2-3 years, driven by key factors such as a widening supply deficit, surging industrial demand from sectors like photovoltaics and electric vehicles, and rising geopolitical tensions.
Combined with shrinking global inventories, mine production challenges, and currency fluctuations, these fundamentals provide strong support for silver’s upward trajectory, he added.
Kedia expects MCX gold price to be around ₹85,000 per 10 grams in the next one year, while he has MCX silver price target of ₹1,30,000 per kg for the same period.
“Silver prices are expected to rise, driven by a widening global supply deficit of 215.3 Moz in 2024 and strong industrial demand from sectors like photovoltaics (232 Moz) and electric vehicles. China's 44% increase in silver consumption for green technologies further pressures supply, while mine production declines and inventories are depleting. Geopolitical tensions, speculative demand, and a tightening silver-to-gold ratio also support the bullish trend. With growing use in electronics, power grids, and EVs, combined with a weaker US dollar, silver prices could potentially reach $72 in the long term,” Kedia said.
On the technical front, silver prices seem to be poised for a major breakout, supported by long-term technical patterns and Fibonacci retracement levels.
“The price is currently trending above the Ichimoku cloud, affirming a bullish momentum. A breakout above the $30 neckline could drive Silver toward $41.50, while a sustained move above this could propel it toward $49.82 and eventually to $71.98, in the long term as long as prices are above $22.50 which is a 50% Fibonacci retracement based on key Fibonacci levels,” Kedia said.
Speaking on why gold price may underperform silver in the next one year period, Kedia said the noted key reasons such as expectations of slower interest rate cuts by the US Federal Reserve, increased shorts by speculators, rise in hedging activity by producers and other technical factors.
“Historical data shows gold prices have seen a correction after US Presidential elections. Moreover, current technicals show RSI is above 80 and signalling profit booking on gold rates. Strength in the US dollar may further weigh on bullion prices. This makes us cautious on gold prices in the second half of 2025,” Kedia said.
Considering all these factors, Kedia recommends buying silver for the long-term as it is expected to outperform gold.
On the contrary, Chintan Mehta, Chief Executive Officer, Abans Holdings is more bullish on gold prices.
“With inflation stabilizing and central banks starting to cut rates, the low-interest environment is only going to boost gold demand further. We believe gold stands out in times of uncertainty. It’s a complete safe-haven unlike silver, which always has that industrial component attached to it, adding an extra layer of risk. So, while looking for reliability when markets like equity or real estate aren’t doing well, gold usually comes out on top,” Mehta said.
In the short term, he expects gold rates to see a dip from profit-taking or delays in rate cuts, but those dips will act as buying opportunities.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
