Published: Fri 1 May 2026, 1:32 PM
Silver price forecasts across key horizons have been sharply cut by UBS, driven by subdued investment demand, weaker industrial usage, and climbing mine production. The major Swiss bank now projects June-end silver at $85, down from $100 previously. September falls to $85 from $95, December to $80 from $85, and March 2027 to $75 from $85. Spot silver currently trades around $73.80.
This reassessment reflects a tighter supply-demand outlook. UBS anticipates the 2026 silver deficit narrowing sharply to 60–70 million ounces from an earlier 300 million ounce estimate.
“For 2026, we expect weaker demand from photovoltaics due to elevated prices; higher prices are also weighing on silverware and jewelry demand,” strategists Wayne Gordon and Dominic Schnider wrote in a note. “Together, we estimate these channels to reduce demand by about 50mn oz,” they added.
Supply looks firmer, with mine output projected near 850 million ounces.
UBS noted investment demand cooling: ETF holdings plunged nearly 70 million ounces to 794 million, while speculative futures positions eased above 100 million ounces. Full-year investment demand estimate dropped from over 400 million to 300 million ounces—“still generous given year-to-date outflows.”
“Consistent with the smaller deficit, we have trimmed our price outlook across all forecast horizons. In our base case, we expect silver to trade broadly sideways,” the strategists said.
UBS held back deeper cuts, citing gold’s support. “We still expect gold prices to trend higher, providing an important anchor for silver,” the strategists said, adding that the gold-silver correlation has strengthened lately. The bank sees the gold-silver ratio drifting toward 75–80 over time.
Strategically, UBS prefers selling volatility over long positions. Implied volatility has eased from February’s 150 percent realized peak but stays historically high. “We view selling downside risk to harvest carry over the next three months as attractive,” the bank said.
