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18
12, 2025
XAG/USD Breaks Above $66 on Record Run, Rate-Cut Bets and a Supply Squeeze
Silver extended its explosive 2025 rally on Wednesday, December 17, 2025, pushing deeper into record territory as momentum traders, industrial buyers, and macro investors piled into the “white metal” at the same time.
At roughly 12:17 (time-stamp on live pricing feeds), spot silver (XAG/USD) traded around $66.35 per ounce, up about 4% on the session, with the day’s range stretching from roughly $63.68 to $66.56. [1]
That move came after silver briefly cleared $66 and set a fresh all-time high around $66.52/oz, according to Reuters, as markets reacted to a softer labor-market narrative, shifting rate expectations, and a broader bid across precious metals. [2]
Silver price today at 12:17: where the market stands right now
The live tape tells the story of a market in “price discovery” mode:
- Spot silver (XAG/USD): ~ $66.35/oz at 12:18:17 on the feed (used here as the closest read to 12:17). [3]
- Session move: roughly +4% at that time stamp. [4]
- Intraday high: around $66.52–$66.56, depending on the feed. [5]
- Big picture: Reuters pegged silver’s 2025 gain at roughly +126%, outpacing gold’s ~+65% annual rise. [6]
Silver’s surge is also happening in a broader “white metals” upswing: Reuters reported platinum hitting a 17-year high and palladium moving higher in the same risk-on/rate-cut setup, reinforcing the sense that investors are rotating across the complex rather than treating this as a silver-only story. [7]
What’s driving silver’s surge: the three forces behind the rally
Silver is unusual because it trades like both a precious metal and an industrial input. This week’s price action reflects all of that “dual identity” firing at once.
1) Rate-cut expectations are back in the driver’s seat
Silver doesn’t pay interest, so the metal tends to benefit when markets expect lower policy rates and easier financial conditions.
Reuters tied Wednesday’s push to renewed expectations of U.S. Federal Reserve easing after signs of labor-market softening and investor positioning for additional 2026 cuts. The same Reuters report also pointed to safe-haven support stemming from heightened geopolitical tension around Venezuela. [8]
2) A physical market that looks tight (and feels tighter when money pours in)
A major theme in the latest round of analysis is that silver’s rally isn’t only “paper-driven.” Analysts argue the physical side is strained—then gets even tighter when investment products absorb metal.
An Investing.com analysis highlighted how silver-backed ETPs (exchange-traded products) have added an estimated 187 million ounces in 2025 (an ~18% increase in holdings), and emphasized that metal held in ETPs is effectively removed from the pool available to industry and some settlement flows. [9]
Trefis echoed the same core mechanism: once ETF flows flip positive, “paper demand” can turn into a real-world price accelerant because physical inventory has to be sourced and warehoused. [10]
3) Industrial demand and the “critical mineral” narrative are reinforcing the bid
Beyond the macro and flows story, silver’s bullish case still leans heavily on industrial use—especially as electrification and “green tech” expand.
A key policy tailwind in the background: the U.S. Geological Survey notes that the final 2025 U.S. critical minerals list adds silver among the newly included minerals, tying the metal more explicitly to supply-chain security and strategic planning. [11]
That designation doesn’t automatically change supply/demand overnight, but it can reshape how market participants talk about silver—particularly around inventories, sourcing, and the longer-run importance of reliable supply.
What changed since Dec. 15, 2025: the key news, forecasts, and analyses in the last 48 hours
Below is the clearest “through-line” from the most recent coverage and commentary published since December 15, 2025—the window you requested.
Dec. 15, 2025: Analysts focus on a breakout market and a demand shock
Forecast chatter turned more aggressive. Technical and macro-focused market commentary argued that silver’s momentum was being reinforced by supportive macro conditions and policy narratives.
- FXLeaders framed the move as a continuation of silver’s breakout and highlighted the $70/oz area as a logical milestone for bulls in a momentum-driven market. [12]
- Investing.com’s analysis leaned into the idea of industrial demand colliding with large investment inflows, emphasizing the scale of ETP accumulation as a core stressor for the market. [13]
- INN’s “Silver Price Forecast” package (dated Dec. 15) argued that silver’s structural deficit story remains central, citing Metals Focus estimates for continued deficits into 2026 (though potentially smaller than 2025). [14]
- Trefis summarized 2025’s surge as a “supply-and-demand squeeze,” spotlighting the combination of stronger industrial pull and the sudden return of investment flows. [15]
How this mattered for price: Dec. 15 reads like the point where a lot of market commentary stopped treating silver as a “catch-up trade” and started treating it as a standalone leadership trade—which can feed momentum when positioning is underbuilt.
Dec. 16, 2025: A more cautious institutional tone emerges (even as the rally holds)
As silver consolidated and traders debated how much of the move is “fundamental” versus “flow-driven,” bank research introduced an important counterweight:
- Reuters reported Morgan Stanley’s view that silver may lag gold, and that 2025 could mark a peak supply deficit with solar installations expected to fall in 2026—a notable caution given how central solar demand is to many bullish narratives. [16]
Meanwhile, mainstream market trackers continued to anchor the move in eye-catching spot levels: Fortune’s commodity snapshot (Dec. 16) put silver at about $63.37/oz at 8:30 a.m. ET, underscoring how elevated prices already were even before Wednesday’s fresh highs. [17]
How this mattered for sentiment: When a market is ripping higher, the most important “bearish” inputs often aren’t outright negative calls—they’re reasons the upside might slow. Morgan Stanley’s argument effectively says: even if precious metals stay strong, silver’s 2026 incremental demand may not be as one-way as the 2025 narrative suggests. [18]
Dec. 17, 2025: Silver breaks above $66, and $70 becomes the “next number”
On Wednesday, silver moved from “strong” to “headline” again:
- Reuters reported spot silver touching a record ~$66.52/oz and quoted a market view that $70/oz looks like a logical next target in the near term, while also describing rotation flows out of gold and into silver and other white metals. [19]
- Reuters also tied the day’s move to shifting rate expectations and geopolitical risk, with markets watching upcoming U.S. inflation releases (CPI and PCE) as the next potential volatility trigger. [20]
In short: Dec. 15 built the narrative, Dec. 16 introduced pushback, and Dec. 17 confirmed the market still wants higher prices.
Silver price forecast: where analysts see XAG/USD heading next
Forecasting silver right now is less about pinning down a single number and more about mapping scenarios—because silver’s volatility cuts both ways.
Near-term (days to weeks): $70 is the widely cited “magnet level”
Two separate strands of coverage converged on the same milestone:
- Reuters cited a view that $70/oz is the next logical target in the short term. [21]
- FXLeaders similarly highlighted the $70 area as a key psychological level as the market extends its breakout. [22]
What would likely support a push to $70: cooling inflation surprises, weaker real yields, continued ETF/ETP inflows, and sustained physical tightness.
What could block it: a sharp rebound in the U.S. dollar, hotter inflation prints that force repricing of rate cuts, or aggressive profit-taking after such a rapid run.
2026 outlook: bullish long-term stories vs. real risk of a “demand air pocket”
This is where forecasts start to diverge.
The bullish camp:
INN’s Dec. 15 forecast roundup emphasizes the idea of a persistent structural supply deficit and argues that even if deficits shrink, they can still underpin prices—especially if investment demand remains firm. [23]
A separate, more aggressive public-market forecast surfaced via Barron’s reporting from a December 2025 event: strategist Mary Ann Bartels (Sanctuary Wealth) floated $80–$100/oz as a potential silver range in her 2026 outlook remarks. [24]
The cautious institutional view:
Morgan Stanley’s note (via Reuters) is a reminder that silver’s 2025 setup may not repeat cleanly: the bank expects silver to underperform gold and flags the possibility that the supply deficit peaks in 2025, partly due to falling solar installations in 2026. [25]
How to reconcile these:
- If 2026 sees easing monetary policy and strong investment demand persists, the “bull case” can stay alive even if some industrial segments cool.
- If industrial demand (especially solar-linked) slows meaningfully and investor flows fade, silver can still remain high—but the path may be choppier, with bigger pullbacks.
Why “critical mineral” status matters more than it sounds
Silver’s addition to the U.S. critical minerals list is not a day-to-day trading signal—but it can influence policy focus, permitting priorities, and the way investors frame long-term supply risk.
USGS explains that the final list identifies minerals vital to the U.S. economy and national security that face potential supply disruption risks, and that the 2025 update added silver among other minerals. [26]
That policy backdrop is one reason the metal is increasingly discussed in the same breath as other strategic inputs used in electrification and advanced manufacturing—even as it remains a traditional precious metal.
What to watch next: the catalysts that could move silver after today’s record
Silver is now so headline-driven that the next major macro print can matter as much as physical-market signals.
1) U.S. inflation data (CPI and PCE)
Reuters notes markets are looking to upcoming releases—CPI and PCE—as the next major inputs into rate expectations and, by extension, precious metals pricing. [27]
2) The path of Fed cuts into 2026
Reuters reported that investors are pricing two 25-basis-point cuts in 2026, reinforcing the macro tailwind for non-yielding metals. [28]
3) ETP/ETF flows and inventory signals
If the “ETP absorption” story continues at scale, it can keep the market tight. If flows reverse, the same channel can amplify downside volatility. [29]
4) Industrial demand signals (especially solar-linked)
Morgan Stanley’s caution about solar installations in 2026 is a reminder that not all industrial demand is guaranteed to accelerate indefinitely. [30]
Bottom line
As of 12:17 today, silver is trading like a market where macro tailwinds (rate-cut bets), policy narratives (critical mineral status), and real-world constraints (tight physical supply plus investment absorption) are reinforcing each other—pushing XAG/USD to fresh records above $66/oz. [31]
The near-term “number” most analysts and traders keep circling is $70/oz, but forecasts for 2026 are increasingly split between very bullish upside cases and more cautious bank research that argues silver’s strongest deficit dynamics may cool. [32]
References
1. www.investing.com, 2. www.reuters.com, 3. www.investing.com, 4. www.investing.com, 5. www.reuters.com, 6. www.reuters.com, 7. www.reuters.com, 8. www.reuters.com, 9. www.investing.com, 10. www.trefis.com, 11. www.usgs.gov, 12. www.fxleaders.com, 13. www.investing.com, 14. investingnews.com, 15. www.trefis.com, 16. www.reuters.com, 17. fortune.com, 18. www.reuters.com, 19. www.reuters.com, 20. www.reuters.com, 21. www.reuters.com, 22. www.fxleaders.com, 23. investingnews.com, 24. www.barrons.com, 25. www.reuters.com, 26. www.usgs.gov, 27. www.reuters.com, 28. www.reuters.com, 29. www.investing.com, 30. www.reuters.com, 31. www.investing.com, 32. www.reuters.com
