Silver rose to its highest level in nearly 12 years on Thursday, riding the coattails of gold's rally to record peaks on interest rate cuts by major central banks.

Spot silver was 1.3% up at $32.26 per ounce as of 1234 GMT, having hit $32.71 earlier in the day, its highest since December 2012.

"Silver is going to continue to rally over the coming quarters because of the consecutive rate cuts and as China's stimulus could continue for some time," said Amelia Xiao Fu, head of commodity markets at BOCI, adding that she sees the price moving towards $37 level.

Silver, which serves as both a safe-haven investment and a key material in industrial applications, has rallied more than 36% so far this year.

One of the primary catalysts for the rally has been gold, said Aneeka Gupta, director of macroeconomic research at WisdomTree, adding that the gold-to-silver ratio has come down with silver's rally.

The gold/silver ratio, which measures the number of silver ounces needed to buy an ounce of gold, indicates silver's value in relation to gold.

The bulk of the remaining demand for silver has been driven by the industrial sector. Silver's usage in photovoltaic products like solar panels has nearly doubled over the prior year, Gupta added.

Spot gold, meanwhile, was up 0.6% at $2,673.21 per ounce, having hit a record high of $2,685.42 earlier in the day. U.S. gold futures for December delivery rose 0.4% to $2,696.30.

Bullion has risen over 29% so far in 2024, smashing records several times, fuelled by U.S. rate cuts, safe-haven demand and robust central bank buying.

"Gold price strength is feeding on itself just now. That’s to say momentum is driving speculative flows despite a rising U.S. dollar and Treasury yields," said independent analyst Ross Norman.

The Fed trimmed benchmark policy rates by 50 basis points to 4.75%-5.00% last week. Traders see a 63% chance of a 50 bps reduction in November.

Lower interest rates boost non-yielding gold's appeal.

Powell is set to give opening remarks later on Thursday at a conference, where New York Fed President John Williams and Fed Vice Chair for Supervision Michael Barr will also speak.

"Powell's comments will be observed for indications about the depth of further cuts. But really it's a case of when, not if," Norman added.

In other metals, platinum rose 2.3% to $1,011.20 and palladium gained 2.3% to $1,061.25.

(Reporting by Anushree Mukherjee, Swati Verma, Anjana Anil, Daksh Grover and Sherin Varghese in Bengaluru; Editing by Emelia Sithole-Matarise)