XAG/USD trades marginally lower near $61.00 as Fed rate hike expectations and a stronger USD pressure precious metals.
Silver (XAG/USD) remains under pressure, trading slightly above $61.00 in European hours after a 5.3% drop on Tuesday. The decline follows growing expectations of Federal Reserve interest rate hikes, driven by resilient US economic data and persistent inflation above the Fed’s 2% target.
The CME Fed Watch Tool now shows a 36% chance of a July rate hike and 68% for September, up from 28% and 50% last week. A stronger US Dollar, fueled by skepticism over US trade deals and equity market sell-offs, further weighs on precious metals. XAG/USD hit a 2026 low of $60.74 earlier but struggles to break below $61.00.
Technical indicators suggest oversold conditions, with the 4-hour RSI near 30 and MACD signaling caution for sellers. Below $60.00, the next support level is seen at $58.00.