Silver delivered one of the sharpest round trips among major metals in 2026, according to market data reviewed by GoldSilver. The metal reached a record high near 121.6 dollars per ounce in January 2026, then fell roughly 35 percent from that peak as speculative positioning unwound and price sensitive demand pulled back.

The retreat did not erase the market underlying tightness. Silver is in its sixth year of supply deficit, with a projected shortfall of 46.3 million ounces in 2026, and cumulative drawdowns from above ground stocks running into the hundreds of millions of ounces since 2021. Forecasts point to a wide range for the balance of the year. UBS trimmed its year end target to 80 dollars per ounce and set a mid year figure near 85 dollars, reflecting expectations of a narrowing deficit and softer demand growth.

Analysts emphasize silver dual role. It behaves as a monetary metal during periods of macroeconomic stress, moving with gold, while its heavy industrial footprint in solar cells and electronics ties it to the manufacturing cycle. That combination can amplify both rallies and corrections. The data frames a market defined by volatility, where a record breaking surge and a steep pullback occurred within months, underpinned by a structural deficit that keeps inventories thin.

Source: GoldSilver - https://goldsilver.com/industry-news/goldsilver-news/silver-market-deficit-2026-six-years-and-getting-worse/