Silver and Platinum Surge 13% and 14% as Dollar Weakens and ETF Inflows Rise

Silver and platinum prices have surged significantly, driven by a combination of factors including dollar weakness, rising ETF inflows, and tightening industrial supply. This shift in investor sentiment has led to a powerful surge in these precious metals, as market participants seek alternatives to gold amid concerns over its overvaluation.

In June, silver climbed above $36 per ounce, marking a 13-year high, while platinum reached $1,273, its strongest level in four years. The rally in these metals is fueled by fears of a weakening dollar and the diminishing safe-haven appeal of gold. Investors are now turning to silver and platinum, which offer solid industrial fundamentals and are seen as viable hedges against currency fluctuations.

According to analysts, the current gold-to-silver ratio of 93, which is well above the historical average, indicates that silver remains undervalued. This has led to a significant increase in silver ETF inflows, with more than 300 tonnes of inflows this month—double the figures from May. The tightening market for both silver and platinum, driven by industrial demand, further supports the outlook for these metals.

Silver is essential in various industrial applications, including solar panels, batteries, and glass coatings. Platinum, on the other hand, remains vital in auto catalytic converters and other industrial uses. The slower-than-expected adoption of electric vehicles continues to underpin platinum usage, while Chinese demand for platinum jewelry is rebounding. As above-ground inventories shrink, both metals are positioned for continued investor interest and potential price gains.

The weakening of the dollar, which has fallen more than 8% so far in 2025, has further fueled interest in these metals. The delay in implementing new tariffs on EU imports has eased short-term trade tensions, but the overall economic uncertainty persists. This environment has led to a rotation of investment flows from gold, which has historically been a macro hedge, to higher-beta plays like silver and platinum.

The shift towards silver and platinum is not just a reaction to immediate market conditions but also a reflection of a broader economic trend. The deglobalization process, accelerated by trade wars and geopolitical tensions, has made traditional investment strategies less effective. Investors are now seeking assets that can provide stability and growth in a more fragmented global economy. Precious metals, with their limited supply and historical value, fit this criteria well.

The move towards silver and platinum also highlights the changing dynamics of the precious metals market. While gold remains a staple for many investors due to its low volatility and negative correlation with traditional assets, silver and platinum offer higher potential returns. This is particularly appealing in an environment where traditional safe-haven assets are underperforming. The increased demand for these metals is also driven by their industrial uses, which provide an additional layer of value beyond their role as investment assets.

In summary, the shift towards silver and platinum as dollar hedges reflects a broader trend in the investment landscape. As the dollar weakens and economic uncertainty persists, investors are turning to precious metals for stability and growth. This trend is likely to continue as the global economy navigates the challenges of deglobalization and trade tensions.