Silver (XAG/USD) traded around $73.10 during the Asian hours on Friday, remaining in negative territory after recent volatility. The decline was attributed to a stronger US Dollar, which increased the cost of silver for foreign buyers, and subdued trading activity due to the Good Friday holiday [1].
Market sentiment toward silver was dampened by intensifying hawkish central bank expectations for 2026, with rising energy prices linked to Middle East tensions reinforcing inflation concerns. These factors supported a tighter policy outlook, reducing the appeal of non-interest-bearing precious metals like silver [1].
Geopolitical developments also contributed to market uncertainty. US President Donald Trump warned of intensified military action in the Strait of Hormuz over the next two to three weeks, issuing strong threats against Iran. Iran’s Foreign Minister Abbas Araghchi responded that recent US strikes on civilian infrastructure would not force a retreat, describing them as evidence of an opponent in disarray and moral decline [1].
Chicago Fed President Austan Goolsbee expressed concern about rising oil prices, noting they could complicate efforts to curb inflation, especially if gasoline costs surge and lift inflation expectations. Meanwhile, Dallas Fed President Lorie Logan supported holding rates steady at the latest FOMC meeting, citing a stabilized labor market since late 2025 but weak payroll growth and "uncomfortable" conditions [1].
CONCLUSION
Silver prices have come under pressure due to a stronger US Dollar, hawkish central bank outlooks, and heightened geopolitical tensions. The market remains cautious, with inflation concerns and subdued trading activity contributing to a negative sentiment for silver. Forward-looking statements from Fed officials suggest continued vigilance on inflation and interest rates, which may keep silver's appeal limited in the near term.