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Silver Soars: Will Yields Halt the Rally?
1 Jun
Summary
- Silver ETF SLV surged 129% over the past year.
- Treasury yields above 4.70% could end silver's rally.
- Industrial demand from solar and EVs drives silver consumption.
The iShares Silver Trust (SLV) has experienced a significant rally, with its value increasing by roughly 129% over the past year and approximately 8% year to date as of June 1, 2026. This surge has brought the silver ETF to decade-plus valuations, prompting questions about its sustainability.
SLV's performance is closely tied to macroeconomic factors, primarily Treasury yields. A sustained rise in 10-year Treasury yields above 4.70% could negatively impact silver prices by widening the opportunity cost of holding a non-yielding asset. Currently, the 10-year yield stands at 4.56% as of June 1, 2026, having seen an increase since the beginning of the year.
However, silver's appeal extends beyond its precious metal status. Approximately half of its consumption is driven by industrial applications, including solar photovoltaic cells, electric vehicle components, and electronics. This industrial demand is considered a crucial swing factor for silver's performance in 2026, potentially offsetting the pressure from rising yields, especially if oil prices continue to climb and influence inflation prints.
