Silver (XAG/USD) continued its downward trajectory, trading around $72.90 during Asian hours on Thursday after registering minor losses the previous day [1]. The decline is attributed to fading safe-haven demand as optimism grows over potential peace in the Middle East. US President Donald Trump stated that Iran’s military capabilities have been significantly weakened, including its missile and drone capacity, and emphasized that the US no longer relies on Middle Eastern oil. Trump also signaled intentions to conclude the conflict swiftly, further reducing geopolitical risk [1].
The US Dollar rebounded after two days of losses, creating headwinds for dollar-denominated silver by making it more expensive for foreign buyers and dampening demand. However, the upside for the Greenback may be limited as easing Middle East tensions reduce safe-haven flows [1]. Despite recent losses, silver is on track for its second consecutive weekly gain, up more than 7%, as markets reassess the US Federal Reserve’s policy outlook amid shifting geopolitical risks, growth concerns, and persistent inflation pressures [1].
The Federal Reserve kept interest rates unchanged at 3.50%–3.75% following its March 17–18, 2026 meeting. The median dot plot still points to one 25-basis-point rate cut later in 2026, although some policymakers now anticipate no cuts this year [1]. US Treasury yields are recovering, with both 2-year and 10-year notes extending gains after strong economic data reinforced expectations that rates could remain steady for longer. St. Louis Fed President Alberto Musalem commented that current monetary policy is appropriately positioned and likely to remain unchanged for some time [1].
CONCLUSION
Silver prices are under pressure due to reduced safe-haven demand and a stronger US Dollar, despite ongoing weekly gains. The Federal Reserve’s steady policy stance and recovering Treasury yields suggest limited near-term upside for silver, with market participants closely watching geopolitical developments and inflation trends.