XAG/USD retreats to $58.80 amid Middle East instability and Fed rate hike expectations ahead of key US jobs data.
Silver prices fell during Asian trading on Monday, with XAG/USD dipping to $58.80 per troy ounce after two days of gains. The decline follows renewed military tensions in the Strait of Hormuz, where US-Iran clashes drove oil prices higher and stoked inflation concerns.
Investors remain cautious as diplomatic efforts resume this week, with both nations agreeing to halt attacks ahead of peace talks in Doha. The conflict escalated after an Iranian projectile struck a cargo vessel last Thursday, prompting mutual accusations of ceasefire violations.
Silver also faces pressure from hawkish Fed expectations, with traders pricing a 59.7% chance of a rate hike by September 2026. Markets await this week’s US labor data, including Thursday’s Nonfarm Payrolls report, for clues on monetary policy.