Silver breaks above $75 to reach a new high, analysts predict surpassing the $100 mark by 2026

Over the past year, silver has far outperformed gold, with a rise of up to 158%, compared to only 72% for gold. On December 26th, silver hit a record high, breaking through the $75/oz mark, while gold also reached $4,531/oz. What is behind this strong surge in precious metals?

Geopolitical Tensions and Central Bank Policies Resonating, Precious Metals Becoming Safe Haven Favorites

From a macro perspective, global geopolitical tensions continue to escalate. The US has increased sanctions on Venezuelan oil and taken military action against Nigeria, which has heightened market risk aversion. Meanwhile, expectations of Federal Reserve rate cuts have supported precious metals, as low interest rates weaken the dollar’s appeal, boosting demand for physical gold and silver holdings.

Why Has Silver’s Gain Significantly Outpaced Gold? Supply Anxiety Sparks Buying Frenzy

More notably, the reason for silver’s much larger increase compared to gold lies in extreme supply tightness. Market expectations of potential US tariffs on silver have led investors to heavily stockpile silver spot holdings in the US, causing global silver inventories at exchanges to rapidly deplete. This buying frenzy has further fueled speculative enthusiasm, creating a market phenomenon similar to a run on the metal.

London Silver Market Faces Physical Shortages, Bullish Short Squeeze Atmosphere

The most striking development is the severe physical squeeze in the London silver market. Investors are selling off paper contracts and rushing to buy physical silver, causing a key indicator—the 1-year silver swap rate spread over US interest rates—to fall to -7.18%, clearly reflecting an extreme shortage of physical supply.

Dutch trading expert Karel Mercx pointed out: “As long as this spread remains negative, upward pressure on silver will be difficult to dissipate.” This means that as long as the physical squeeze persists, the momentum for silver prices to rise will continue.

2026 Silver Target Price of $100, with More Aggressive Predictions of $200

Market analysts are quite optimistic about future trends. US economist Peter Schiff believes that the surge in silver prices reflects the market’s real response to monetary pressure and supply-demand imbalances. He considers reaching $100/oz by 2026 a “very realistic target,” and if monetary market turmoil intensifies further, prices could go even higher.

French bank BNP Paribas also has a bullish outlook, estimating that silver could reach $100/oz by the end of 2026.

Jim Rickards, author of Currency Wars, offers an even more forward-looking prediction. He believes 2026 will be another explosive year for gold and silver, and if gold ultimately hits $10,000, silver could soar to an astonishing $200/oz.