TD Securities has raised its forecasts for silver and platinum group metals (PGMs), while flagging near-term correction risks similar to those seen in gold. The bank upgraded its outlook over the next two quarters and also lifted its longer-term view, linking the revision to expectations of continued strength in gold alongside an improving global economy.
TD Securities expects silver and platinum to move into deficits, with supply described as weak and demand rising in the post-conflict period following the Persian Gulf conflict. The revised stance rests on tighter market balances for both metals as conditions shift towards stronger end-use and financial demand.
Strengthening Fundamentals and Supply Deficits
We believe that any near-term dips in silver should be viewed as buying opportunities. While the market faces correction risks similar to gold, the underlying fundamentals for silver are strengthening considerably. This suggests that traders should prepare for upward price movements over the next few months.
The fundamental case is supported by a widening supply deficit. The Silver Institute’s latest report confirmed a structural deficit for the third straight year, forecasting a 215.3 million ounce shortfall in 2026. This supply tightness is a powerful tailwind for prices.
For platinum, the situation is much the same, pointing to a broader trend in precious metals. The World Platinum Investment Council’s Q1 2026 report highlighted a deepening supply deficit, projecting a 476,000-ounce shortfall for the year. This deficit is driven by stagnant mine output and rising demand from the auto and industrial sectors.
This demand is underpinned by a recovering global economy. Global manufacturing PMIs have ticked up for the third straight month, with the J.P.Morgan Global Manufacturing PMI hitting 51.2 in May 2026, signaling expansion. Increased industrial activity following the recent Persian Gulf conflict will further boost demand for these metals.
Market Positioning, Strategic Plays, and Managing Short-Term Risks
Silver is expected to follow gold, which is currently consolidating around $2,450 an ounce. Historically, silver tends to outperform gold during precious metal bull markets, and we see the potential for the gold-silver ratio to compress from its current level near 80:1. This makes silver a leveraged play on gold’s continued strength.
Given this outlook, we are looking at long-dated call options on silver futures to capture the expected upside. Contracts for late summer or the fourth quarter appear attractive, as they allow time for the market deficits and economic recovery to exert upward pressure on prices. Implied volatility remains reasonable, presenting a good entry point for building these positions.
However, traders should remain cautious of a short-term pullback in the coming weeks. We are considering using short-term put options to hedge against any sudden drops or simply waiting for a price dip toward key support levels before establishing larger long positions. This balanced approach manages the immediate risk while positioning for the strong forecast ahead.
