Silver is caught between two opposing forces: bulging exchange inventories that keep a lid on prices and a surprisingly resilient retail appetite for coins and bars. The metal last changed hands at $59.40 an ounce on the COMEX, a level that leaves it 8.5% below its 50-day moving average of $64.90 — a clear sign that the technical picture has been eroding for weeks.
Vaults Keep Filling Up
Supply-side data underscore just how comfortable the physical market has become. Total silver held in COMEX depositories climbed by 1.2 million troy ounces to 333.2 million ounces, according to media reports, with 103.1 million ounces registered as deliverable against contract obligations. A separate reading put total stocks at 332.01 million ounces, of which 103.4 million ounces were immediately available for settlement. The extra metal sitting in exchange warehouses has eased near-term fears of a squeeze.
That build-up stands in contrast to what is happening at the retail end of the market. Australia’s Perth Mint booked a sharp jump in demand during September, with sales of silver products rising 81.3% from the previous month to 605,408 ounces — the strongest monthly tally since March and roughly 4.6% above the year-earlier level. The figures suggest private and institutional buyers treated the depressed price as a buying opportunity rather than a warning sign.
Rates Remain the Dominant Driver
For a metal that pays no yield, the path of US monetary policy continues to call the tune. Inflation data have stoked speculation that the Federal Reserve could tighten further, and Saxo Bank commodity strategist Ole Hansen said the price trend had reinforced expectations of a rate move at the upcoming central bank meeting.
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Money markets, however, are telling a more nuanced story. Traders put the odds of the Fed leaving rates unchanged at its October 27–28, 2026 gathering at 65%, according to Reuters. The dollar also retreated from a prior 18-month high, handing silver room to consolidate. Fed officials Austan Goolsbee and Mary Daly weighed in on the inflation and rate outlook, while Fed chief Kevin Warsh is scheduled to speak on October 16.
A Busy Data Calendar Ahead
Attention now turns to a string of US releases. Producer price and retail sales figures land on October 15, followed by Warsh’s remarks the next day. The main event remains the Fed’s rate decision on October 28, which is expected to set the tone for silver’s next directional move.
The Longer View: From Deficit to Surplus?
Beyond the near-term rate debate, investors are starting to focus on the medium-term balance of supply and demand. Deutsche Bank sees a possible shift into a supply surplus for the silver market in 2027, citing rising inventories and cooling industrial demand. Should that scenario play out, the structural demand deficit that has underpinned the market would give way.
For now, the immediate question is whether the metal can hold its current footing before the late-October Fed verdict. As long as US rates stay elevated and exchange warehouses keep filling, the fundamental case for a sustained silver rally looks limited.
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