Mumbai, Oct 14: Silver prices surged to an all-time high above $52.50 an ounce on Tuesday, driven by a historic short squeeze in London and strong demand for safe-haven assets amid global economic uncertainty.

Spot silver in London rose to $52.58 an ounce, surpassing the previous record set in January 1980 when billionaire Hunt brothers attempted to corner the market.

Alongside silver, gold prices also hit a new record, marking eight consecutive weeks of gains, supported by rising geopolitical tensions and expectations of US interest rate cuts.

The silver rally comes amid concerns over liquidity in the London market, prompting a global rush to secure the metal. Prices in London are trading at a premium compared to New York, leading traders to ship silver bars across the Atlantic—a practice usually reserved for gold. The premium stood around $1.55 an ounce on Tuesday, down from $3 last week.

Adding to the squeeze, silver lease rates in London—costs for borrowing the metal—surged above 30% for one-month contracts, making it expensive for traders to maintain short positions. Strong demand from India in recent weeks further reduced the available supply, following earlier shipments to New York amid fears of US tariffs.

Experts said the surge in gold and silver reflects heightened market uncertainty. Gold prices have jumped nearly 60% this year, crossing the $4,100 mark, supported by geopolitical tensions, rate-cut expectations, and strong central bank and investor buying.

Key US economic data, such as inflation and retail sales, are due later this week, but analysts warn that if the government shutdown continues, the release of these reports—including jobs data—could be delayed.