The silver market is heading toward its sixth consecutive year of structural deficit, while global silver demand is projected to remain stable in 2026. According to preliminary forecasts prepared by consultancy Metals Focus for the Silver Institute, the silver shortfall is expected to reach 67 million ounces. Industrial silver fabrication is anticipated to decline by 2% in 2026, falling to a four-year low of 650 million ounces, primarily due to reduced usage in solar photovoltaic applications and trends toward direct substitution. Meanwhile, jewelry demand is forecast to drop for the second consecutive year, decreasing by 9% to 178 million ounces, the lowest level since 2020. Total global silver supply is expected to grow by 1.5%, reaching a ten-year high of 1.05 billion ounces. Within this total, mine production is projected to increase by 1% to 820 million ounces, while recycling volumes are expected to rise by 7%, surpassing 200 million ounces for the first time since 2012.

Ahead of the delayed January employment report, gold and silver futures declined on Tuesday as investors took profits. If the data comes in weaker than expected, it could increase pressure on the Federal Reserve to cut interest rates, potentially providing support for precious metal prices. David Meger, Director of Metal Trading at High Ridge Futures, noted in a report, "We are seeing a slight pullback or consolidation ahead of a series of key economic data releases later this week." He added that geopolitical tensions and expectations for interest rate cuts may continue to underpin gold prices. Analysts at Standard Chartered pointed out in their report, "Outflows from silver ETFs leave silver vulnerable to short-term volatility and are a key indicator to watch. However, the current market deficit suggests a recovery in the coming months."

The front-month February gold futures contract on the NYMEX barely held above the $5,000 mark, closing down 0.9% at $5,003.80 per ounce. Meanwhile, the front-month February silver futures contract on the NYMEX remained well below the record high set on January 26, closing 2.2% lower at $80.218 per ounce.