XAG/USD falls to $57.25 as rising US bond yields and a stronger USD reduce demand for non-yielding assets.
Silver prices reversed early gains to trade 0.7% lower at $57.25 in European trading, after peaking at $58.65 earlier. The decline follows a sharp rise in US Treasury yields, which climbed 1.8% to near 4.71%, their highest level in 18 months.
Expectations of a Federal Reserve rate hike to combat inflation have weighed on non-yielding assets like silver. A rebound in the US Dollar Index to near 101.00, after a weak prior session, further pressured prices. Historically, silver and gold move inversely to bond yields and the dollar.
The 10-year Treasury yield’s surge reflects market concerns over persistent inflation, reducing the appeal of precious metals as alternative investments.