Silver eased on Tuesday after a multi-session rally that pushed the metal to multi-month highs.
The metal came under pressure as fears of renewed tensions in the Middle East pushed the US dollar higher, and a rebound in oil prices continued to push Treasury yields to the upside on inflation concerns.
The latter could continue to fuel expectations of a more restrictive tilt in monetary policy, while rising yields across the globe further pressured non-yielding assets such as silver.
Markets reacted after US President Trump rejected Iran’s proposal and highlighted the fragility of the current ceasefire, raising concerns around potential new tensions in the region.
Despite the short-term pullback, silver’s structural backdrop remains supportive. Demand from electrification, renewable energy, electronics, AI infrastructure, and automotive production could help limit downside pressure. At the same time, expectations for a sixth consecutive annual supply deficit continue to underpin longer-term sentiment.
However, if geopolitical tensions persist and materially weaken global growth, industrial activity in key sectors could slow, limiting silver consumption. Attention now turns to US inflation data, which may shape expectations for future monetary policy and influence silver’s short-term direction.
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