Following the U.S. government’s announcement of new tariffs on April 2, 2025, the global financial landscape has been thrust into a fresh wave of uncertainty. As markets react to shifting trade dynamics, investors are once again turning to precious metals in search of stability. While gold remains the go-to safe-haven asset, silver’s unique position—straddling both the precious and industrial sectors—presents a more complex investment outlook. In this piece, Business Monthly examines how silver’s market trajectory may evolve throughout 2025, as geopolitical developments intersect with rising global industrial demand.
According to the latest data from CNBC’s live silver price chart, the current market valuation of silver was approximately $31.985 per ounce as of April 14, 2025.
Tariff tensions cloud silver’s outlook in 2025
The latest round of U.S. tariffs could significantly impact silver prices, as the metal’s unique role straddling both investment and industrial uses leaves it particularly exposed to trade disruptions. Daniela Sabin Hathorn, Senior Market Analyst at Capital.com, told Business Monthly, “If tariff tensions escalate, markets may begin to price in an increased risk of a global economic slowdown. In that case, safe-haven flows could return to both gold and silver, potentially offsetting some of the weakness stemming from industrial demand destruction.”
Unlike gold, which historically performs well during periods of economic stress, silver’s valuation is more directly influenced by industrial activity. Hathorn explained, “Silver’s performance is more directly tied to the health of the global economy, with its significant industrial applications in sectors like solar energy and electric vehicles.” This dynamic makes silver especially vulnerable to global trade fluctuations, as tariffs can amplify demand-side pressures.
Silver’s supply chain is already feeling the effects of renewed trade friction, particularly due to ongoing U.S.-China tensions. With China playing a key role in global silver production, the U.S. decision to impose a 104% tariff on Chinese exports—effective April 12, 2025—raises serious concerns about supply stability. The situation escalated further after former President Donald Trump announced, via the Truth Social platform, an immediate hike to 145%. The Silver Institute states, “Potential tariff hikes under Trump’s administration and their impact on global economic growth will likely restrain investor enthusiasm across the broader industrial metals complex.”
In the short term, these uncertainties may dampen investor sentiment and complicate silver’s market dynamics. Robert Gottlieb, a precious metals industry expert and former managing director at JP Morgan & HSBC, pointed out the pressure this is placing on silver market liquidity: “Silver was more distorted due to the threats of tariffs. 185mm ounces of silver were shipped into the CME since December, creating significant tightness in the London OTC market (lease rates over 6%), especially as silver doesn’t have a lender of last resort like gold (Central Banks).”
This strain highlights one of silver’s fundamental vulnerabilities: unlike gold, it lacks the backing of central banks as a stabilizing force. As trade tensions evolve, investors and policymakers alike will be closely watching how these factors continue to reshape the silver market in 2025.
Investor sentiment: Silver’s place in the market
The silver-to-gold ratio, which reached around 101.5 on April 14, 2025, reflects a shift in investor preferences toward gold amid rising uncertainty. Hathorn explained, “Silver’s dual role makes it lag behind gold during periods of economic uncertainty. While gold remains the preferred safe-haven asset, silver is increasingly affected by industrial demand.” As a result, silver’s price is likely to be weighed down by industrial uncertainties, particularly amid the ongoing tariff dispute.
Despite this, there are signs of optimism in the silver market. Peter Spina, founder of GoldSeek.com and SilverSeek.com, suggests in a Market Watch article on March 22 that once market sentiment shifts, silver could experience a dramatic price surge, potentially outperforming gold. “When excitement builds, silver’s smaller market size could lead to a rapid price rise,” Spina adds, offering a more bullish outlook for silver.
Affirming this point, Boris Mikanikrezai, Head of Metals Research, shared his outlook with Business Monthly, stating, “The long-term outlook remains positive because solid end-use trends (such as demand from the solar and electric vehicle sectors) and constrained supply support tighter market fundamentals over time, even though short-term silver trading is driven primarily by market positioning rather than fundamentals.”
He further added, “The historically average gold-to-silver ratio is approximately 60:1. Given its mean-reverting property, the ratio is expected to revert to near historical levels—and may even overshoot downward—once economic conditions shift to a risk-on environment. This reversion, which may occur later next year (2026), would signal silver outperforming gold.”
Industrial demand: Silver’s key role in the green energy transition
One of the most critical drivers of silver’s market in 2025 is its indispensable role in industrial applications, particularly in renewable energy. Hathorn highlights, “More than 50% of silver’s annual demand is now attributed to industrial purposes, and this percentage is expected to rise in the coming years.” As the global push for clean energy intensifies, silver’s role in technologies such as solar energy and electric vehicles becomes ever more essential.
The International Energy Agency (IEA) projects that solar capacity will double by 2030, further solidifying silver’s importance in the green energy transition. While efforts to reduce silver usage per application continue, alternatives like copper and aluminum remain less efficient. As Hathorn notes, “The reduction of silver per application has nearly reached its limits, and efficient substitutes remain elusive.” This suggests that industrial demand for silver will remain strong in the years ahead, even amidst geopolitical risks and tariff tensions.
Looking ahead: Navigating risks and opportunities in the silver market
As silver enters 2025, investors should focus on several key factors shaping its outlook. Ongoing trade conflicts, potential technology restrictions, and geopolitical instability all have the potential to impact silver’s performance. Simultaneously, shifts in green energy policies, along with Federal Reserve monetary policy, could present opportunities for silver, particularly if they stimulate demand for renewable technologies.
The Silver Institute’s 2025 market forecast predicts a persistent supply deficit, marking the fifth consecutive year where demand is expected to surpass supply. Despite this, demand for silver remains steady at 1.20 billion ounces, driven by industrial applications and retail investment. However, declining demand for jewelry and silverware continues to weigh on the market.
The Institute anticipates a 3% increase in industrial silver fabrication, exceeding 700 million ounces, while total silver supply reaches an 11-year high of 1.05 billion ounces. However, these positive trends must be viewed against the backdrop of geopolitical uncertainties, especially the escalating tariff tensions. Any disruption to global silver supply could further intensify the market’s deficit.
One of the biggest risks remains the supply-demand imbalance. The combination of growing industrial demand and constrained supply could lead to significant price volatility. As Hathorn concludes, “The mismatch between rising industrial demand and constrained supply could lead to sharp price fluctuations, and investors must remain vigilant as these risks unfold.”
“The overall silver shortage will remain significant, although its impact on prices will be tempered by the availability of extensive silver inventories. Market adjustments will eventually result in an emerging backwardation in the silver market. In such a scenario, constrained physical supply will lead funds to purchase physical silver, pushing prices higher,” explained Mikanikrezai.
