Silver prices recorded a sharp increase to their highest levels this month, thus attracting the attention of Elon Musk who warned about the risks that industrial manufacturers may face.
Throughout December, silver prices rose significantly in line with the rise in prices of other precious metals such as gold and platinum which also recorded record highs on Boxing Day.
Analysts explained that this increase was driven by expectations of an interest rate cut by the Federal Reserve (Fed) of the United States (US) in 2026.
This situation caused the demand for hard assets to increase as a hedge against inflation and currency depreciation to increase.
In addition, new restrictions on silver exports from China that came into effect on January 1 have raised concerns about the supply of the metal in the global market.
Geopolitical tensions have also contributed to an increase in demand for safe-haven assets.
Silver prices on Friday reached $79 per ounce, which is the highest ever recorded. This value has jumped from $56 in early December and is significantly higher than the $29 per ounce in early 2025.
In a post on the X platform, Elon Musk stressed that the surge in the metal’s price is not a good development as silver is widely used in various industrial processes.
Silver uses include the electrification sector, solar panels, electric vehicles and data centers — all areas that have seen demand increase, thus reducing the available silver stocks.
In addition to industrial uses, silver also acts as a financial metal that functions as a store of value.
IG market analyst Tony Sycamore described the situation as a “generational bubble” in the silver market, with huge capital flowing into the precious metal market.
According to Sycamore, the price increase is driven by expectations of several interest rate cuts by the Fed in 2026, support from central bank purchases and private investors, as well as a serious supply and demand imbalance for silver.
The situation has led to increased competition for physical metal.
Bloomberg sources reported that most of the world's silver is currently awaiting the outcome of a US Commerce Department investigation into whether imports of the critical mineral pose a national security risk. The decision could lead to tariffs or trade restrictions on silver.
During the same period, gold and silver recorded their best performances since 1979. Gold prices have risen more than 70% this year, reaching more than $4,500 an ounce from $2,623 in early 2025.
Spot platinum rose 5.3% on Friday to $2,338.20 an ounce, posting its strongest weekly gain on record.
