Shanghai silver futures rose more than 18% in May, industry insiders say there may be limited upside potential in the future.

Since May, Shanghai silver futures have rebounded strongly, with the price of the main contract rising rapidly from 18,000 yuan/kg to above 22,000 yuan/kg at one point. Data from Wenhua Finance shows that as of 13:52 on May 14, the highest price of the main Shanghai silver futures contract reached 22,055 yuan/kg, hitting a new high in nearly a month, with the latest price at 21,437 yuan/kg, an intraday increase of nearly 2%, and a cumulative increase of over 18% since the beginning of this month. Looking ahead, Wu Jiang believes that the trend of rising silver futures prices is relatively limited due to geopolitical factors. If easing geopolitical tensions lead to a overall decline in energy prices, the market may refocus on the actual economic situation, shifting concerns from high US inflation to the reality of declining inflation, leading to a lack of upward momentum in silver prices; conversely, if geopolitical tensions return to a tense state, international crude oil prices may rise again, US inflation pressure may prompt the Federal Reserve to take countermeasures, thereby suppressing overseas liquidity and affecting the valuation center of gold and silver. In terms of risk preferences, there are signs of excessive expansion in market risk preferences represented by the stock market recently, which also limits the upside potential for silver. In terms of liquidity evolution, Jerome Powell will take office as the chair of the Federal Reserve this week, and if his proposals for "balance sheet reduction" and "interest rate cuts" are implemented, it may put pressure on the valuation of precious metals that rely on overseas liquidity.