Musk warns on silver rally flagging demand for industrial use

New Delhi: Tesla and SpaceX CEO Elon Musk has warned that the runaway silver rally is worrying because of its need in many “industrial processes”.

“This is not good. Silver is needed in many industrial processes,” Musk, recently posted on social media platform X.

Reactions on social media ranged from alarm to caution, with users saying Musk’s concern signalled the rally’s excesses.

“I tried to warn you all. You know it is bad when Elon musk is worried about silver price soaring into oblivion,” a user post.

The rally of silver has been surprising to many users as the white metal is hovering around $79 an ounce and eclipsed Nvidia in implied market value on Monday.

The usage of silver in electric vehicles could be of concern for Musk, who runs EV maker Tesla.

Silver prices in global markets retreated sharply after touching fresh intraday records of $84 per ounce in the spot market. The white metal slipped as much as 8 per cent from its peak due to strong profit booking, snapping what could have been a seventh consecutive day of gains.

March silver futures on MCX are trading up 4.22 per cent intraday as of 10.10 am, at 2,49,282 per kilogram.

Analysts noted that silver’s surge has outpaced most assets, including gold and major stocks, due to speculative inflows, supply deficits and surging industrial demand. They noted that silver does not have notable reserves like gold as the London gold market is underpinned by around $700 billion of bullion that can be lent out in the event of a liquidity squeeze.

Further, thin holiday trading amplified the sharp moves due to subdued volumes. Silver’s industrial uses such as in solar panels, electric vehicles and data centres have tightened inventories.

Silver has delivered exceptional returns of around 158 per cent year‑to‑date in 2025 but a recent report from Axis Mutual Fund warned overvaluation could lead to ETF outflows or a downturn in copper could also weigh on silver prices.
IANS