Precious Metals Surge as Silver Takes Centre Stage
28 August 2025
It has been a breakout week for precious metals, with gold surging back above USD $3,400oz.
Silver has also been well bid, last trading above USD $39oz, with many market commentators now expecting the precious metal will soon push above the all-important USD $40oz per price point, a level last seen in the 2011 silver mania.
In Australian dollar terms, silver continues to push toward new highs and is back trading above AUD $60oz (Figure 1), after beginning the year at just $47.7oz. With the gold to silver ratio now sitting at just 87:1, having started the month of August at just over 91.
Given silver outperforming gold has been the historical norm in fully fledged precious metal bull markets, the price action seen this month is highly encouraging for precious metal bulls, who are increasingly convinced gold, silver and platinum will march to new highs across the rest of 2025.
This is certainly the view of Fidelity International, with Ian Samson, multi-asset portfolio manager recently noted; “We have never seen this scale of uncertainty and change around tariff policy, and the effects are yet to dissipate. Gold’s status as the ultimate ‘safe haven’ leaves it well placed for any further surprises. In addition, the unrelenting size of the US budget deficit raises concerns about monetary debasement, which further boosts the long-term case for gold.”
Samson went on note that; “Multiple countries, including China, India, and Turkey, are structurally increasing their holdings of gold, in a bid to diversify exposure away from US dollar. Gold has long been a store of value and a diversifier, without the credit risk associated with paper currency reserves. More broadly, gold supply is very constrained, meaning even a small increase in portfolio holdings could move the dial. For instance, if foreign investors decide to move some of the $57trn they currently hold in US assets, gold is a likely beneficiary.
Below, we delve into the latest trends in silver market demand and price performance, with the findings providing extra encouragement as it relates to the outlook for silver, and precious metals more generally.
Key Trends in Physical Silver Investment
Physical silver bullion investment continues to be one of the most fundamental areas of global silver demand throughout 2025. Over the last decade and a half, silver bar and coin investment has varied widely, extending from just 157 million ounces (Moz) in 2017 to an all-time peak of 338Moz in 2022. This highlights the white metals high demand side volatility.
As a recent publication by the Silver Institute (Market Trend Report on Key Physical Silver Investment Markets) illustrates, four key markets across the globe, notably the United States, India, Germany and Australia, now account for approximately 80% of total retail investment into physical silver. This indicates an extremely concentrated market, with these countries heavily shaping global silver demand trends we see today.
Looking at overall returns, year to date (YTD), silver (24.6%) is marginally outperforming gold (22.3%) in Australian dollar terms. Silver is also strongly outperforming risk assets, including Bitcoin (14.7%), the ASX 200 (9.3%) and the S&P 500 (9.5%).
Silver’s exceptional long-term rally is also evident when compared against both Australian and U.S. equity indices over a 25-year horizon, with outperformance highlighted on a total return and compounded annual growth rate (CAGR) basis, as shown in Table 1.
Figure 1: Gold and Silver in AUD (Jan 2000 – July 2025)
Source: LBMA, RBA, ABC Bullion
Table 1: Key Asset Class Returns Table Over Multiple Time Horizons
Source: ABC Bullion, LBMA, RBA, Investing.com, Yahoo Finance
The report also highlighted the following key points:
The U.S. remains the cornerstone of global physical silver investment, with a staggering 1.5 billion ounces accumulated since 2010. Retail buying peaked during the 2020–2022 COVID crisis years, supported by safe-haven flows and strong IRA demand. However, since late 2023, liquidations have accelerated, with 2025 expected to mark a seven-year low of just 46Moz as investor appetite cools in an increasingly uncertain economic environment.
India has consistently ranked as the second-largest physical silver investment market and occasionally surpasses the United States. Bars continue to dominate purchases, often linked to festivals and gifting traditions, comprising of 70% of total retail demand (2024). Despite rupee silver prices climbing above Rs.100,000/kg, contributing to a total return in 2024 of 21%, selling back has remained limited. Investor sentiment remains deeply bullish, while the rapid adoption of silver exchange-traded products (ETPs) has broadened market participation.
After years of strong demand (average investment of 48.5 Moz between 2020 and 2022), Germany’s retail investment collapsed following the removal of favourable VAT treatment in 2023. Net purchases fell by 80% (39 Moz) over two years as liquidations surged, with a similar decline experienced across the gold market. Early signs of recovery are emerging in 2025, but overall volumes remain subdued relative to the historic highs seen during COVID and the Ukraine-Russia conflict.
Australia has firmly established itself as the fourth-largest silver investment market globally, with demand rising from 3.5Moz (2019) to a record 20.7Moz (2022). Recent growth in local markets has been bolstered by favourable tax treatment and the integration of silver into superannuation accounts.
For those wishing to explore the full findings, the complete Silver Institute report is available here:
Jordan Eliseo
General Manager, ABC Bullion
Luke Tyler
Market and Business Analyst, ABC Bullion
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