Conversely, reclaiming $31.81 might spark a rebound towards the 61.8% retracement level at $32.53, providing a potential short-term buying opportunity.
At 13:34 GMT, XAG/USD is trading $31.86, up $0.003 or +0.01%.
Trump’s Tariff Policies Weigh on Industrial Demand
The silver market is grappling with uncertainty tied to U.S. President Donald Trump’s tariff policies. His recent investigation into new copper tariffs has heightened inflation concerns, which traditionally support precious metals.
However, silver’s dual role as both a safe-haven and an industrial metal adds complexity. While gold might benefit from safe-haven demand, silver could face pressure if tariffs dampen industrial activity. Traders are cautious, balancing silver’s appeal as a hedge against inflation with its vulnerability to a potential slowdown in industrial demand.
Gold’s Performance Influences Silver Sentiment
Gold’s recent price action is also shaping sentiment in the silver market. After a sharp 2% drop on Tuesday, gold steadied on Wednesday, maintaining a broadly bullish trend. A potential breakout above $2,956.31 could lift silver, as traders often view silver as a cheaper alternative to gold. However, if gold fails to gain traction, silver might remain under pressure, especially if industrial demand weakens amid tariff and economic concerns.
Economic Data Could Be a Game Changer
Upcoming U.S. economic data, including Friday’s Personal Consumption Expenditures (PCE) report, could provide fresh direction for silver prices. Inflation pressures and potential shifts in Federal Reserve policy might impact silver’s industrial demand outlook.
