Silver Rises Over 120% YTD 
Published: 08-18-2026, 04:47 pm | Updated: 08-18-2026, 05:04 pm
Key Takeaways
- Silver trades at $63.81 an ounce, roughly 47.5% below its January 29, 2026 record of $121.62 [GoldSilver]
- Speculative crowding has already washed out: net long positioning equals 20.5% of open interest, the 20th percentile of the past 60 weeks [CFTC]
- Gross short positions climbed 40% since mid-July, which builds a natural bid underneath the market [CFTC]
- The 10-year real yield at 2.41% is the mechanism behind the drawdown, and it operates in both directions [FRED]
- Silver’s sixth consecutive annual deficit is forecast at 46.3 million ounces, wider than 2025’s 40.3 million, even as solar cuts its silver use [Silver Institute]
- Chair Warsh delivers his first Jackson Hole keynote on Friday, August 28, nineteen days before the September 16 FOMC decision [Kansas City Fed]
Silver has fallen further than almost any major asset this year, and the temptation is to read that as a verdict on the metal. It is not. The August data tells a stranger and more useful story: the paper market has already done its selling, the physical market disagrees with the screen price, and a single interest-rate number explains most of what happened.
This is the August edition of our monthly silver outlook. Rather than restate the decline, we will name the mechanism behind it, show what positioning data reveals, and mark the specific dates that could change the setup.
Why Is Silver Down 47% When Gold Is Only Down 22%?
Because silver is the higher-beta expression of the same trade, and the trade turned on real interest rates.
Silver last traded at $63.81 an ounce, down about 3.0% on the session from an open of $65.79 [GoldSilver]. By contrast, gold sat at $4,356.29, down roughly 1.4% [GoldSilver]. Measured from their January peaks, however, the gap widens dramatically. Silver is down about 47.5% from its $121.62 record; gold is down about 22.1% from its $5,589.38 high. That is a 25-percentage-point spread between two metals that usually move together.
The reason is not a collapse in silver demand. It is the real yield, meaning the return a Treasury bond pays after subtracting expected inflation. The 10-year inflation-indexed yield stands at 2.41%, with the nominal 10-year at 4.68% and the 10-year breakeven at 2.28% [FRED]. When bonds pay a genuine 2.4% above inflation, the opportunity cost of holding an asset that pays nothing rises sharply. Silver, which carries no yield and less monetary demand than gold, absorbs more of that pressure.
Consequently the pattern held through the second quarter as well. Silver lost 13.3% while gold lost 10.5% through June 19, driven by a firmer dollar and higher global sovereign bond yields, according to OANDA senior market analyst Kelvin Wong [OANDA]. Long-end yields have kept climbing since, a dynamic we covered separately in our work on the term premium [GoldSilver].
The important feature of a mechanism, though, is that it runs both ways. Real yields rose and silver fell. If real yields fall, the same arithmetic reverses.
The Knowledge That Changes Everything
Two essential guides — yours free. Understand why gold matters and why fiat currencies always fail.
What Does Silver Positioning Data Actually Show in August 2026?
It shows that speculative money has largely left, which is the opposite of a crowded trade.
How to measure speculative crowding correctly
However, most commentary quotes net long contracts as a raw number, which is close to meaningless. The measure that matters is net speculative length as a share of open interest, because that expresses how much of the market’s total commitment sits on one side.
On that basis, silver’s net non-commercial position was 23,646 contracts against 115,127 contracts of open interest as of Tuesday, August 11, or 20.5% [CFTC]. Across the past 60 weekly reports, that share has ranged from 15.1% to 38.8%. Only 12 of those 60 weeks sat lower than today. In other words, silver’s speculative crowding sits in roughly the 20th percentile of the last fourteen months.
That matters because crowded trades fall hard when they unwind. Uncrowded ones have already unwound.
What the short side is telling you
Meanwhile something less obvious happened underneath. Open interest actually rose from 105,023 to 115,127 contracts between July 14 and August 11, even as the net long share fell [CFTC]. Both sides of the book grew. Gross short positions expanded from 11,172 to 15,629 contracts, an increase of about 40% in under a month.
In other words, gross shorts function as stored buying power. Every short position must eventually be closed by purchasing a contract, so a larger short base becomes a natural bid under a falling market. That does not predict direction. It does change the shape of the response to any upside catalyst.
The contrast with gold sharpens the point. Gold’s net speculative length climbed from 182,070 to 217,940 contracts over the three reports to August 11 [CFTC]. Money is building a position in gold. It is not building one in silver.
Is the Silver Supply Deficit Still Intact After Solar Thrifting?
Yes, and the honest version of that answer is more persuasive than the simple one.
Because solar is silver’s largest industrial buyer, its retreat matters more than any other demand shift. Photovoltaic silver demand is set to fall roughly 19% in 2026 to about 151 million ounces, down from 186.6 million ounces in 2025 [Silver Institute]. That is the largest single-year reduction on record, and the estimate has since worsened: in August, J.P. Morgan put the potential decline nearer 30%, a reduction of about 60 million ounces year over year [J.P. Morgan]. Total industrial fabrication is forecast to fall about 2% to a four-year low near 650 million ounces [Silver Institute]. Manufacturers are thrifting, which means using less metal per unit produced, and in some cases substituting copper outright.
That is the real bear case, and it deserves to be stated plainly rather than waved away.
What reconciles thrifting with a widening deficit
Here is what reconciles it. Even with that reduction fully counted, 2026 remains on pace for a sixth consecutive annual supply deficit of about 46.3 million ounces [Silver Institute]. The deficit did not narrow. It widened to 46.3 million ounces from 40.3 million in 2025, because total supply is contracting about 2% while mine production stays roughly flat, so the modest demand decline is not enough to close the gap [Silver Institute]. Since 2021, cumulative drawdowns from above-ground stocks total 762.1 million ounces, a figure confirmed on page 17 of the World Silver Survey 2026 [Silver Institute]. That approaches a full year of global mine output.
A demand reduction and a broken thesis are therefore not the same thing. Silver lost its fastest-growing demand source and the market still could not supply enough metal. We examined the thrifting question in more depth in our analysis of solar substitution [GoldSilver].
Why Are Physical Silver Premiums Rising While the Price Falls?
Because the futures price and the cost of actually obtaining metal are two different things, and India is currently demonstrating the difference.
India imposed licensing requirements on silver imports in May 2026 to protect foreign-exchange reserves, and shipments effectively stopped for six months. Imports have now restarted. Traders brought in roughly 89.81 tonnes in August through the India International Bullion Exchange, with about 400 tonnes of licences approved, according to Bloomberg reporting citing Metals Focus consultant Harshal Barot [Business Standard].
Yet the revealing number is the premium. Indian local prices carried a 30-day average premium of about $4 an ounce over global prices as of Friday, August 14 [Business Standard]. Read that carefully, because it cuts both ways: J.P. Morgan notes Indian demand has weakened under higher import duties and tighter import rules, so part of the premium reflects policy-constrained supply rather than pure buying appetite [J.P. Morgan]. Buyers in the world’s largest silver-consuming market are paying meaningfully above the screen price to secure metal, at the same moment the screen price sits 47% below its high.
For an owner of physical metal, that divergence is the practical argument. Paper exposure tracks the futures price. Physical ownership tracks whether metal is actually available, and those two things are currently disagreeing.
What Is the Gold-Silver Ratio Saying in August 2026?
It is saying silver has quietly stopped losing ground to gold.
The gold-silver ratio, which is simply the gold price divided by the silver price, stands at about 68:1 today. On July 15 it sat at 70:1, with gold at $4,056 and silver at $57.84 [GoldSilver]. Despite the grim headline drawdown, silver has therefore modestly outperformed gold over the past month.
History suggests why holders watch this number. After the ratio peaked at about 125:1 during the COVID-19 panic, its highest on record [J.P. Morgan], silver outperformed gold by more than 70 percentage points over roughly five months, gaining about 142% against gold’s 40% [GoldSilver]. A ratio near 68 is nowhere near that extreme, so this is not a prediction. Consider the opposing institutional read as well: J.P. Morgan expects the ratio to keep normalising toward 70 through the second half of 2026 and roughly 75 in 2027, which would mean gold continuing to dominate [J.P. Morgan]. The ratio is a relative-value tool, and silver’s recoveries have historically been compressed and violent rather than gradual.
What Could Move Silver Before the September Fed Meeting?
Four dated events, in order.
- FOMC minutes from the July 28 and 29 meeting, released Wednesday, August 19. Under a chair who has curtailed forward guidance, the dissent count carries more information than the language.
- July PCE, Friday, August 28. The Fed’s preferred inflation gauge lands the same morning as the keynote below.
- Chair Warsh’s first Jackson Hole keynote, Friday, August 28. The symposium runs Thursday, August 27 through Saturday, August 29, themed “Financial Innovation: Implications for Payments and Policy” [Kansas City Fed]. This is the month’s largest single catalyst for real yields, and therefore for silver.
- The FOMC decision, Wednesday, September 16, nineteen days after that keynote. Market pricing currently implies roughly a one-in-three chance of a rate increase.
Note that the direction of risk matters here. This is a cycle in which markets are pricing potential hikes rather than cuts, which is precisely why real yields sit where they do. We covered the Jackson Hole setup and its rate mechanism separately [GoldSilver].
What Is the Honest Bear Case for Silver Right Now?
Silver can fall further, and pretending otherwise would be dishonest.
First, real yields may stay elevated or rise. Second, the dollar may strengthen. Solar substitution may accelerate beyond current forecasts if copper-based cells reach scale faster than expected. Institutional forecasters have moved in that direction. J.P. Morgan Global Research cut its 2026 average silver target from $84 an ounce set in May to $70, and now sees $63 in the fourth quarter of 2026 and a $63.9 average across 2027 [J.P. Morgan]. The same desk expects the Fed to hike in December [J.P. Morgan]. ING, in a somewhat older revision, reduced its third-quarter 2026 average forecast to $68 from $79 and its fourth-quarter forecast to $74 from $84, citing higher yields, a stronger dollar and weaker investor demand [ING].
Silver is also genuinely volatile in a way that punishes leverage and short horizons. Silver rose more than 130% over 2025 [J.P. Morgan] and still ended January 2026 up 19% for the month, yet it fell roughly 30% in a single session on Friday, January 30, after exchange margin increases triggered forced liquidations [GoldSilver]. Anyone treating silver as a short-term trade should size accordingly.
Stay On Top of Gold & Silver Prices
Get important market alerts sent straight to your inbox.
People Also Ask
That depends on horizon rather than price level. Silver’s structural case rests on a supply deficit now in its sixth year and industrial demand that is difficult to replace at scale. Its short-term direction rests on real interest rates, which no one forecasts reliably. A structural case does not require the price to move next month.
Mine production rose 3% in 2025 to 846.6 million ounces and is expected to stay roughly flat in 2026 [Silver Institute]. Supply responds slowly to price because roughly three-quarters of silver arrives as a byproduct of copper, lead and zinc mining, where output follows those metals’ economics rather than silver’s.
No. Price is set at the margin by financial flows, while the deficit is a physical balance between supply and fabrication demand. Both can move independently, which is exactly what 2026 has demonstrated.
Mexico is the world’s largest silver producer, which is why Mexican mining exports and the peso often track silver’s price.
Silver has a smaller market, more industrial exposure, and less central-bank monetary demand. Those three features amplify moves in both directions, so silver typically falls harder in drawdowns and rises harder in recoveries.
What Should a Silver Owner Take From August 2026?
Three things, stated without embellishment.
First, the drawdown has an identifiable cause, and that cause is a 2.41% real yield rather than a failure of silver’s demand story. Second, the speculative money that drove the January spike has largely exited, leaving positioning in the 20th percentile of fourteen months and a short base 40% larger than in mid-July. Third, the physical market is paying premiums to obtain metal that the futures market prices as unwanted.
None of that guarantees a higher price. It does mean the setup entering September looks materially different from the setup entering February, even though the price is lower. The deficit is the thesis. The price is the weather.
Live silver and gold prices are available on our price charts.
SOURCES
1. GoldSilver, live gold and silver price charts
2. U.S. Commodity Futures Trading Commission, Commitments of Traders
3. Federal Reserve Bank of St. Louis (FRED), 10-Year Real Yield (DFII10), 10-Year Treasury (DGS10), 10-Year Breakeven (T10YIE)
4. The Silver Institute and Metals Focus, World Silver Survey 2026, 2026 market outlook
5. Federal Reserve Bank of Kansas City, Jackson Hole Economic Policy Symposium
6. Business Standard, India’s silver imports pick up as traders navigate new licensing rules
7. J.P. Morgan Global Research, The path for silver prices in 2026 and 2027
8. ING, silver price forecast revision, Q3 and Q4 2026
9. OANDA, market commentary, Kelvin Wong, senior market analyst
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future results. Always consult a qualified financial advisor before making investment decisions.
You May Also Like:
- What Does an Inverted Yield Curve Mean for Gold Prices — and How Do You Use It?
- Gold Price Outlook August 2026: What Three Data Prints in One Week Mean for Your Metals
- 14 Million Coins Sold. Zero Design Changes in 35 Years. Here’s Why Investors Keep Choosing the Philharmonic.
- Two Inflation Numbers Come Out Every Month. The Fed Only Cares About One.
- Why Your Commodity ETF Gives You Almost No Gold — and What That Costs You
- American Gold Buffalo Coin: The Complete Guide to the U.S. Mint’s Purest Gold
- The Fed Printed $7 Trillion. Velocity Kept It Quiet. That’s Changing.
