Silver remained inside a consolidation range with some volatility as investors continued to assess the geopolitical developments in the Middle East.
The current uncertainty and the latest incidents in the region could continue to support energy prices and inflation concerns, reinforcing expectations for a cautious Federal Reserve stance and a more hawkish tilt from other major central banks.
The latter could leave bond yields at elevated levels, weighing on non-yielding assets, including silver.
Upcoming US PCE inflation and GDP figures will be closely monitored, alongside any signals from the Federal Reserve officials, as they could reshape expectations for the path of monetary policy. Decisions and rhetoric from other major central banks may also influence global yield movements and, consequently, precious metals.
Despite the short-term uncertainty and downside risks, silver could see potential for a rebound in the medium-term if a clear diplomatic deal in the Middle East is put in place. Over the longer term, the outlook remains supported by demand from electrification, renewable energy, AI infrastructure, electronics, and the automotive industries. However, prolonged geopolitical instability could eventually weigh on global economic activity and temper industrial consumption, limiting silver’s upside potential.
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