Citigroup predicts silver will reach $40 per ounce in the next three months, citing supply constraints and increased investor interest amid ongoing trade disputes.
The bank boosted its three-month silver outlook to $40 from $38 and increased its longer-term forecast to $43, according to analysts led by Max Layton. Silver rose to $37.96 per ounce, up 25% from a year ago, while gold climbed to $3,361.91 per ounce, gaining 37% year-over-year.
The rally comes as President Donald Trump’s expanding trade war heightens market uncertainty. Trump announced Thursday that Canada would face 35% tariffs starting August 1, while threatening 50% tariffs on Brazil and additional levies on pharmaceuticals and semiconductors.
The bank expects silver supplies to become increasingly constrained due to ongoing market deficits and reluctant sellers demanding higher prices, while investment demand remains strong.
Silver markets have faced supply shortages since 2021, including a 184.3 million ounce deficit in 2023. Industrial applications in solar panels and electric vehicles are consuming increasing amounts, with solar accounting for 16% of global demand and EVs representing 2.9%, while total production fell from 1.07 billion ounces in 2010 to 1.03 billion ounces last year.
Gold is up 27% this year, “yet U.S. treasuries are kind of meandering around and it’s not really providing the same safe-haven experience that treasuries and the U.S. dollar traditionally played,” said Sprott Asset Management CEO John Ciampaglia. Analysts at JP Morgan forecast gold will reach an average of $3,675 per ounce in Q4 2025.
Federal Reserve officials have signaled potential rate cuts this year, which would boost demand for non-yielding precious metals. The tariffs are estimated to cost US households an average of $1,300 annually, according to the Tax Foundation.
Silver’s dual role as both an industrial metal and safe-haven asset positions it for continued volatility as trade negotiations and monetary policy decisions unfold.
Information for this story was found via Bloomberg, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
