Silver prices (XAG/USD) rose on Monday, with FXStreet data showing the metal trading at $73.53 per troy ounce, up 0.67% from $73.05 on Friday, and marking a 3.45% increase since the beginning of the year [1]. During European trading hours, silver was reported at around $73.30 per troy ounce, holding gains after recovering earlier losses [2]. The Gold/Silver ratio stood at 63.95 on Monday, down from 64.04 on Friday [1].
The upward movement in silver prices is attributed to easing hawkish expectations regarding the Federal Reserve's policy outlook, as traders respond to reports of potential ceasefire prospects in the Middle East [2]. News of US-Iran talks and a proposed framework for ending hostilities, including a two-step plan with an immediate ceasefire, have pressured oil prices and helped ease inflation concerns [2]. Pakistan’s army chief, Asim Munir, has reportedly been in contact with US Vice President JD Vance, special envoy Steve Witkoff, and Iranian Foreign Minister Abbas Araghchi, although Tehran stated it would not reopen the Strait of Hormuz under a temporary ceasefire, according to Reuters [2].
Bloomberg, citing Axios, reported that the US, Iran, and regional mediators are discussing terms for a potential 45-day ceasefire, following US President Donald Trump's warning to Tehran [2]. Despite these developments, markets remain cautious, with the possibility that the Federal Reserve may delay rate cuts and maintain higher borrowing costs if inflation persists [2]. Investors are awaiting the latest Federal Open Market Committee Meeting Minutes for further policy guidance [2].
Both articles highlight that silver is seen as a safe-haven asset, with its price influenced by geopolitical instability, US dollar movements, and industrial demand, particularly in electronics and solar energy sectors [1][2].
CONCLUSION
Silver prices have risen on the back of geopolitical developments in the Middle East and shifting expectations around US monetary policy. While ceasefire prospects and easing inflation concerns have supported silver, market participants remain attentive to upcoming Fed communications for further direction.