XAG/USD falls to $63.00 as rising Treasury yields and safe-haven demand for the dollar weigh on non-yielding assets.
Silver (XAG/USD) declined 0.58% to $63.00 on Thursday, extending its bearish trend as investors recalibrate expectations for US monetary policy. Persistent inflation data and escalating Middle East tensions have bolstered demand for the US Dollar as a safe-haven asset, pressuring the white metal.
Recent US inflation figures, including a 6.5% YoY rise in the Producer Price Index for May, have reinforced bets on a more aggressive Federal Reserve rate hike path. Higher Treasury yields and a stronger USD have reduced the appeal of non-yielding assets like silver, which typically underperforms in tightening cycles.
Geopolitical risks, including heightened US-Iran tensions, have further shifted defensive flows toward the dollar. Markets now assign a high probability to at least one Fed rate hike before year-end, according to the CME FedWatch tool.