Gold-silver ratio: The precious metals staged a smart comeback on Tuesday, February 3, after two days of relentless selling that marked one of the worst declines for the gold and silver prices in decades.
Spot gold prices rallied nearly 6% in the international market to $4,935, putting them on track for the best single-day gain since November 2008, as per a Bloomberg report. Meanwhile, spot silver prices rose 10% to $87.40 an ounce on Tuesday.
At the peak of the precious metals rally, which halted only last Friday, the gold-silver ratio had slumped to 44 levels. But as silver slumped 30% in two days and gold lost almost 9%, the gold-silver ratio has improved to near 60 levels.
What is the gold-silver ratio?
The gold-silver ratio measures the relative value between the two metals. It signals how many ounces of silver will be needed to buy an ounce of gold. You can calculate the gold-silver ratio by dividing the price of an ounce of gold by that of an ounce of silver. The current prices reveal a gold-silver ratio of 56.
Historically, the 10-year ratio averages close to 80:1. And when the ratio drops below 50:1, silver is no longer cheap, stated a report by WhiteOak Capital Mutual Fund.
In previous cycles, a ratio this low has preceded a mean reversion where silver prices corrected significantly faster relative to gold, the report stated — a trend that played out last week.
What does gold-silver ratio signal for investors now?
According to analysts, the gold-silver ratio bottomed out at around 44 last week and is unlikely to test these levels.
This jump in ratio signals a major shift in the market sentiment, particularly marking a “cooling off” period after silver’s massive outperformance in early 2026, said Aamir Makda, Commodity & Currency Analyst, Choice Broking.
The latest uptick has largely been driven by temporary factors — profit booking in silver after a sharp rally, margin-related unwinding in futures, and a brief flight to perceived safety following global risk-off cues, opined Harshal Dasani, Business Head at INVasset PMS.
In the current market environment, analysts expect silver to continue to outperform in the near-to-medium term.
Amit Goel, Chief Global Strategist at PACE 360, said that his sense is that silver will outperform gold in the near term. His near-term target for silver is $100 —about 15% upside from here — while gold has about a 6-7% upside with the target at $5200-$5400.
By definition, he said that the gold-silver ratio could decline by nearly 10%, possibly towards 50.
Harshal Dasani, Business Head, INVasset PMS, also believes that from a broader macro lens, the underlying setup continues to favor silver over the medium term.
“Silver typically outperforms in the later stages of a precious metals cycle, especially when monetary easing, liquidity expansion, and reflationary impulses gather momentum. With rate cuts in play, improving industrial demand visibility, and sustained investment interest, silver is better positioned to regain leadership,” he said, echoing similar views.
For investors, this phase should be seen less as a signal to chase gold and more as an opportunity to prepare for silver to take back the charge in the next leg of the cycle, Dasani added.
Meanwhile, Goel said that while a bounce is expected, investors must know that the one-year outlook for precious metals is extremely negative for now.
How much to allocate to gold and silver now?
Commenting on the ideal allocation, Makda said that silver is a high-risk, high-reward “sprint” metal, and on the other side, gold is a “marathon” runner, providing stability.
“Since the ratio is currently trailing at 55, a balanced, tactical approach is recommended where one can hold 60% Gold and 40% Silver. Also, it is advised not to go “all in” at once and use the SIP sort-of method to get invested,” he advised.
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions.
