Gold hits record highs; silver shortage sparks global panic

Gold prices have surged to record highs across Asia, driving investors toward silver and triggering a global shortage, with supplies sold out in India and panic buying reported in London.

Global gold prices have surged above US $4,300/oz, driven by robust Asian demand, safe-haven flows and record premiums in India ahead of festival season.

In India, gold hit around ₹1.32 lakh per 10 g, the highest in more than a decade, as buyers shifted to coins and bars amid jewellery-retail caution.

With gold’s skyward rally, interest has spilled over into silver—a typically more affordable alternative—but supply tightness and elevated industrial demand have turned silver into the new flash-point. In India and London, physical silver ran out, premiums exploded and lease rates soared—marking one of the worst squeezes in decades.

Why it matters:

• Gold’s dominance: With central banks expanding gold reserves and investors seeking hedges against currency weakness, gold’s breakout rally is structurally supported.
• Silver’s supply stress: Silver’s dual role as an investment and industrial metal (solar panels, electronics) has exposed it to severe shortages when demand spikes.
• Asia in the driver’s seat: India’s festival buying and China’s revival in physical demand are influencing global metal flows, forcing spot markets in London and beyond to react.

Outlook:
Expect further upside risk for both metals: forecasts suggest gold may reach US$5,000/oz or more in 2026, while silver could revisit earlier highs given the ongoing supply-demand imbalance.
At the same time, the market is vulnerable to liquidity crunches, premium spikes, and sharp price corrections—as seen when silver plunged 6 % in one day after reaching a record high above US $54/oz.

Bottom line: Gold is setting the pace, and silver is scrambling to keep up. For investors, that means expanding opportunity — but also elevated risk.