UBS Forecasts Silver to Reach $80, Citing Gold Tailwinds and Strong Demand

Silver is poised for a significant rally and could reach $80 per ounce by September 2027, as it benefits from the same favorable macroeconomic backdrop supporting gold, according to a new report from UBS. The bank's strategists see the precious metal's close link to gold, combined with solid fundamentals, as a key driver for future price appreciation.

A High-Beta Play on Gold

According to UBS strategist Dominic Schnider, silver continues to trade as a "high-beta version of gold," with the correlation between the two metals near multi-year highs. This means silver prices tend to be more volatile but move in the same general direction as gold.

The primary forces expected to lift both metals include persistent fiscal concerns, the risk of a long-term decline in the U.S. dollar's purchasing power, and market expectations for an eventual easing of monetary policy. These factors are projected to fuel sustained investor demand for precious metals as safe-haven assets.

Price Outlook and Market Dynamics

UBS laid out a bullish price trajectory for silver, forecasting a steady climb from its spot price of $66.50 as of September 18.

• December 2026: $70 per ounce
• March & June 2027: $75 per ounce
• September 2027: $80 per ounce

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While a potentially more hawkish stance from the Federal Reserve could create short-term headwinds, Schnider advises investors to use any price pullbacks as buying opportunities rather than chasing short-term rallies. He also noted that there is "limited scope for the gold-silver ratio to sustainably break above 70."

Industrial Demand and Supply Constraints

Beyond its monetary appeal, silver's fundamentals remain strong. Schnider stated that structural support for silver consumption is "sound," despite some thrifting efforts in the solar industry due to higher prices. This pressure is expected to be offset by growing demand from data centers, AI infrastructure, grid investments, and electric vehicles.

On the supply side, output is constrained because most silver is produced as a byproduct of lead, zinc, copper, and gold mining. This structure limits the industry's ability to quickly increase supply in response to rising prices, providing further support for the market.

Risks to the Forecast

UBS identified several downside risks to its optimistic outlook. These include a more aggressive-than-expected monetary policy path, a significant deterioration in global economic growth, or an unexpectedly sharp decline in industrial demand. However, Schnider concluded that the "balance of risks remains skewed to the upside for silver prices in the medium term."