Silver (XAG/USD) remains under pressure on Tuesday and trades around $76.00 at the time of writing, down 2.13% on the day.
The white metal is giving back part of its recent gains as risk appetite improves following US President Donald Trump’s announcement regarding the postponement of an immediate military intervention against Iran
The easing of geopolitical tensions temporarily reduces demand for safe-haven assets. Donald Trump said negotiations with Iran are continuing after requests from Gulf leaders, while also stating that the United States (US) remains prepared to launch a large-scale military operation if diplomatic discussions fail. Despite this relative easing, markets remain focused on the economic consequences of the Middle East conflict.
Disruptions around the Strait of Hormuz continue to support Oil prices, increasing concerns about global inflation. This dynamic reinforces expectations that the Federal Reserve (Fed) may maintain a restrictive monetary policy for longer, or even raise interest rates before year-end. According to the CME FedWatch tool, investors are increasing bets on the possibility of additional monetary tightening later this year.