Every Tuesday afternoon we publish a collection of topics and give our expert opinion about the Equity Markets.
Last week we delved into the gold market, how one could earn interest and concluded with some ideas around the direction of future prices vs the US$ and A$.
This week we will explore some historical facts about silver and see if we can determine whether there are sound directional pointers when looking at the silver vs gold ratio.
Chief uses of silver include:
- Industrial applications (electronics, solar panels, cars, etc.) - Nearly 50% of global silver demand is for industrial applications.
- Jewellery
- Investment (coins and bars)
Mine Production – largely from Zinc and Gold mines.
Primary silver mines form the backbone of global silver supply, accounting for less than 30% of worldwide production yet representing the most dedicated operations in the industry. These mines generate the majority of their revenue from silver extraction, unlike operations where silver is merely a byproduct of gold, lead, zinc, or copper mining.
In 2024, global silver mine production rose by 0.9 percent to 819.7 Moz, underpinned by increased output from lead/zinc mines in Australia and the recovery of supply from Mexico, as Newmont’s Peñasquito mine returned to full production. This was supplemented by additional growth from Bolivia and the US. Lower output from Chile, down 8.8 Moz y/y, partially offset this growth.
Silver production from lead/zinc mines remained the dominant source of silver, but output was flat y/y. In contrast, silver production from gold mines recorded the strongest growth, up 12% y/y to 13.9 Moz, a three-year high.
Last year, Mexico remained the leading silver mine-producing country, followed by China, Peru, Bolivia, and Chile. Of note, Australia’s silver production increased by 19% from 2023 to 2024 to circa 38m ounces.
The Hunt Brothers - What happened when the Hunt brothers cornered the market?
They started stockpiling in the 1970s at prices as low as US$2 per ounce. By early 1979, the price of silver had risen to about US$6 per ounce. The Hunt brothers acquired roughly 195m ounces of silver, about a third of the world’s total supply.
The full and fascinating story can be accessed here – the final outcome for the Hunt brothers was a filing for bankruptcy and litigation for market manipulation and for conspiring to corner the world’s silver market.
How the Hunt Brothers Cornered the Silver Market and Then Lost it All - Priceonomics
Silver vs Gold Pricing – past, present and future.
The Gold-Silver Ratio is one of the most closely followed measures in the precious metals market, tracking how the metal prices of gold and silver move in relation to each other. For example, the Roman Empire officially fixed the ratio at 12:1, while centuries later the U.S. government set it at 15:1 under the Coinage Act of 1792. Of greater interest is possibly when the extremes of the ratio are met – i.e. above 100 ounces of silver to 1 ounce of gold and below 35 ounces of silver to 1 ounce of gold. These extremities have been met only a few time so clearly represent opportunistic times to get long (when the ratio is low) or get short (when the ratio is high). This link to historical charts is useful to see when those extremities occurred.
Current Gold/Silver Ratio - Gold Silver Ratio Chart
The One Year chart is very interesting with the high of 103.95 in May of 2025 and the subsequent fall off as gold surged on a number of factors. The ratio is currently fairly stable at just over 85.
Looking forward.
On technicals, maybe a measured move towards 79, which means that silver outpaces gold by another 8%. If gold stays where it is, that projects silver to US$46.5. Against A$, silver is at an all-time high at A$65.40 (intraday 22nd September 2025). The US$ vs A$ exchange rate has been relatively volatile in the short term, with US$ strength helping the A$ silver/gold price (up).
Looking further forward, the ratio on a weekly chart is sitting on its 200-week moving average. Back in 2021, the ratio hit 60 and further back in 2011, when silver reached its all-time high of US$50 (similar to the Hunt era price), the ratio fell to 30. Given the significant ongoing use of silver for industrial use, there may be a case for believing that the ratio could head lower.
In closing, below are some useful links to economic releases/comments.
Week Ahead – Key Catalysts
- Central Banks Front & Centre
• Powell speaks Wednesday – potential market mover as the market hangs on Powell’s tone post Fed rate cut.
• Fed parade – Williams, Bostic, Bowman, Goolsbee, Barr, Logan, Daly all on the docket.
• RBA Gov Bullock Monday – AUD could be choppy.
• BOE’s Bailey + MPC members Tuesday/Thursday.
• SNB policy decision + press conference Thursday. - Data Highlights
• Tuesday: Global flash PMIs – real-time growth read.
• Wednesday: Australia CPI – test for sticky inflation.
• Thursday: US final GDP, jobless claims, durable goods.
• Friday: US Core PCE – Fed’s preferred inflation gauge.
Next week we will be taking a good look at Iron Ore, Coking Coal and Steel. What is the global outlook for each and what are the influencing factors.
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