Sprott Physical Silver-U Surges 1.82% on Weakening Dollar, Fed Rate-Cut Hopes, Hits 2025 High

Sprott Physical Silver-U (PSLV) climbed 0.94% on Tuesday, marking its second consecutive day of gains with a 1.82% rise over the past two days. The stock reached its highest level since September 2025, surging 1.66% intraday as demand for physical silver assets gained momentum.

The rally in PSLV reflects broader macroeconomic dynamics, notably the weakening U.S. dollar. A decline in the DXY00 index, driven by soft labor market data and heightened expectations of Federal Reserve rate cuts, has reduced the cost of silver for global investors. With geopolitical uncertainties and political concerns eroding confidence in dollar assets, non-U.S. buyers are increasingly turning to precious metals as a hedge, amplifying demand for silver-backed ETFs like PSLV.

Anticipation of aggressive Fed easing further supports the upward trajectory. Market pricing now reflects a 15% probability of a 50-basis-point rate cut at the September FOMC meeting and an 81% chance of a 25-basis-point cut in October. Such policy shifts lower the opportunity cost of holding non-yielding assets like silver, making PSLV an attractive option for investors seeking protection against inflation and currency devaluation.

Global macroeconomic risks also play a role. Escalating geopolitical tensions and supply chain disruptions in mining sectors have created a supply-demand imbalance, favoring higher silver prices. Meanwhile, technical indicators in the futures market show increased speculative activity and institutional bullish positioning, reinforcing near-term momentum. Retail investor participation, fueled by social media and trading platforms, has added to the upward pressure on physical silver demand.

PSLV’s performance is further bolstered by its unique position in the precious metals sector. While gold has outpaced silver in recent months, silver’s industrial applications—such as in electronics and solar panels—ensure sustained demand beyond investment flows. ETF inflows into physical silver trusts have accelerated, with low storage costs and liquidity advantages making PSLV a preferred vehicle for capital seeking tangible asset exposure amid economic uncertainty.