Silver Faces Collective Institutional Bearishness: UBS Warns of Shrinking Demand, HSBC Cites "Overstated Fundamentals"

BlockBeats News, May 28th, the silver market is currently facing a dual test of weakening demand and price pressure, with multiple institutions pointing out that the "aftermath" of the 2025 price surge is now emerging.

The silver price briefly exceeded $120 per ounce on January 28th, followed by a one-day plunge of nearly 30%. Despite subsequent rebounds, the price has experienced an overall decline. After rising to around $87 on May 14th, it suffered another sell-off, with the price fluctuating mainly in the $75 to $78 range over the past two weeks. On Thursday, it fell over 3.5% to around $71.98 during the trading session.

UBS pointed out in a recent report that the approximately 140% price increase in 2025 has significantly suppressed downstream industrial demand and warned that as long as the price remains at the current level, demand contraction may persist. The bank also believes that unlike gold, which benefits from central bank purchases, silver lacks a strategic demand anchor and is therefore considered "unattractive" in the current environment.

HSBC similarly regards the silver market as "fundamentally overvalued," with limited upside potential. It predicts that the gold-silver ratio may widen in the future, indicating relative weakness in silver prices. Meanwhile, Macquarie has given a more bearish outlook from a macro perspective, suggesting that the Federal Reserve may raise interest rates again in the first half of 2027, which would exert pressure on precious metals. It warns of significant downside risk for the silver price if the macro situation further deteriorates.