The volatility in silver continues on the last day of 2025. It opened at Rs 2.21 lakh/kg, down nearly 4% from its previous close of Rs 2.51 lakh/kg. In the global markets, COMEX silver prices plunged to an intraday loss of over 7% at $71.97/oz.
On December 29, the white metal hit an all-time high of $83.62/oz on COMEX, while on MCX it touched an all-time high of Rs 2.54 lakh/kg. Just after hitting its high, the precious metal shed its gains, largely attributed to high profit-booking by traders and a hike in CME margins. The hike accelerated a sell-off in the precious metals markets, as silver futures fell from $83/oz to $71/oz.
So what exactly drove the soft ending for silver? Here are three major catalysts –
#1 Repeated CME margin hikes
The Chicago Mercantile Exchange (CME) has implemented three margin hikes on precious metals including silver, in December, with two hikes being scheduled within a span of just one week. After silver’s record high rally on December 29, the group issued an advisory raising margins by $3,000 for the most-active March 2026 contract, to $25,000 from $22,000. The hike accelerated a crash of more than 10% in a short span of trading, as silver futures eased from a high of $83/oz to $71/oz.
#2 Reduced speculative positions
Analysts added that the hike diminished speculative positions in the market, while demand still remains intact. “Monday’s (Dec 29) sell-off was amplified by the CME’s decision to raise margin requirements on silver futures, forcing leveraged traders to reduce exposure after prices became technically overstretched. The decline reflected position unwinding rather than a shift in underlying demand,” says Jigar Trivedi, Senior Research Analyst at Reliance Securities.
#3 Sharp correction after profit booking
What followed the hike was a huge sell-off by traders as the markets witnessed a crash. Silver futures fell by Rs 21,000 on MCX in just one session, while COMEX silver futures plummeted by nearly 11% intraday. However, the markets staged a recovery, as following the rally, silver was trading near the $73/oz mark. In today’s session, silver hit a high of $76/oz.
For 2025, silver has gained over 140%, marking its best-ever gains and even outperforming gold, which has gained nearly 66% this year. The undertone for the white metal remains bullish as the industrial demand for the metal stands strong. Furthermore with supply constraints and China’s export restrictions set to kick in, it is now to be seen how high can the precious metal climb in 2026.