Silver (XAG/USD) stabilizes around $63.45 on Wednesday, up 0.16% on the day at the time of writing.
The white metal is attempting to regain its footing after hitting an intraday low of $62.19, initially extending the pullback that followed Tuesday’s rejection from the $66.50 area
Silver remains under pressure in a cautious market environment as investors monitor the deteriorating situation in the Middle East. The Memorandum of Understanding between the United States (US) and Iran expired on Monday, while US President Donald Trump confirmed on Tuesday that no talks with Tehran are currently taking place. Disruptions to maritime traffic through the Strait of Hormuz are also keeping tensions elevated in the energy market, reinforcing concerns about the conflict’s inflationary consequences.
This prospect could complicate the task of the Federal Reserve (Fed) and limit its room to tighten monetary policy. Investors now await the Minutes of the Federal Open Market Committee (FOMC) July meeting, due on Wednesday at 18:00 GMT, for fresh clues about the path of US interest rates. Since that meeting, weaker-than-expected labor market and inflation data have reduced expectations of a September rate hike.