Silver Prices Surge: A Global Rally Hits Afghan Markets

The price of silver is experiencing a historic rally, nearly doubling in global markets in less than a year. This sharp upward trend has reverberated strongly in Afghanistan, where local prices have mirrored the dramatic increase. Economic experts point to a potent mix of financial policy, industrial demand, and geopolitical anxiety as key drivers behind the surge.

The Numbers: A Steep Climb

Data underscores the scale of the increase:

• Globally: According to TradingView, the price per troy ounce of silver skyrocketed from USD 29.6 in early January 2025 to USD 63.1 in mid-December.

• In Afghanistan: Tracking the global rally, Investing.com data shows the price in Afghan markets rose from 2,174 afghanis (USD 30.9) to 4,187 afghanis (USD 63.3) per ounce over the same period.

• Local Context: Fawad Salehzada of the Kabul Jewellers’ Association reported that on 16 December, the price for one gram of silver in Kabul stood at 130 afghanis.

Drivers of the Demand: More Than a Precious Metal

Analysts cite a convergence of factors propelling prices upward:

1. The Green Energy Revolution: Economic analyst Qais Mohammadi identifies this as a primary, structural driver. “The more the world moves towards green energy, the greater the demand for silver will be,” he stated. Silver is a critical component in photovoltaic cells for solar panels and various other electronic applications, linking its future directly to the global transition away from fossil fuels.

2. Monetary Policy and Safe-Haven Appeal: The U.S. Federal Reserve’s recent interest rate cuts—including a third cut on 10 December—have played a significant role. “As people anticipate an economic downturn, they increasingly turn to investments in gold and silver,” Mohammadi explained. Lower interest rates reduce the opportunity cost of holding non-yielding assets like bullion, making them more attractive. Ahmad Shah, a money changer at Kabul’s Sarai Shahzada, added that global wars and insecurity are fueling demand for these traditional safe-haven assets.

3. Industrial and Strategic Buying: Fawad Salehzada highlighted soaring industrial consumption, noting, “China is purchasing hundreds of kilograms of silver daily from various countries.” Furthermore, reports that some nations are diversifying portions of their foreign currency reserves into precious metals have added to strategic demand pressure.

4. Market Fundamentals: Underpinning these factors is a classic supply-demand imbalance. Mohammadi noted, “Demand for silver has increased, while production has declined relative to demand,” creating a tight physical market.

Uncertainty and Local Impact

The Fed’s rate cuts have reportedly sparked internal disagreement, creating uncertainty about the future economic path. This very uncertainty, however, continues to channel investment into precious metals.

In Afghanistan’s markets, the rally is reshaping activity. “Most money changers have now shifted their business activities towards gold and silver,” observed Ahmad Shah. The surge highlights how global macroeconomic trends and commodity shocks transmit directly into the Afghan economy, affecting traders, jewellers, and consumers who rely on silver both as an investment and a raw material.

As 2025 draws to a close, market watchers expect volatility to continue, with silver’s trajectory tied to the pace of green energy adoption, central bank policies, and the unfolding global economic outlook for 2026.

 

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