Silver Price Forecast: XAG/USD moves above $34.00 due to rising geopolitical tensions

• Silver price receives support from safe-haven flows amid rising Middle-East tensions.
• Israel targeted the offices of Hezbollah's al-Qard al-Hassan financial institution in southern Beirut.
• The non-yielding Silver gains ground due to easing monetary policies from major central banks.

Silver price (XAG/USD) extends its winning streak for the fifth consecutive day, trading around $34.10 during the Asian session on Monday. This upward trend is driven by safe-haven demand amidst escalating geopolitical tensions in the Middle East.

Lebanese media report that Israel has launched a new series of airstrikes on southern Beirut, targeting the offices of Hezbollah's al-Qard al-Hassan financial institution. Furthermore, the US government has initiated an investigation into the unauthorized release of classified documents that outline Israel's military preparations for a potential strike on Iran.

Furthermore, easing monetary policies from major central banks are bolstering non-yielding Silver prices. On Monday, the People's Bank of China (PBoC) reduced the 1-year Loan Prime Rate (LPR) from 3.35% to 3.10% and the 5-year LPR from 3.85% to 3.60%. Last week, the European Central Bank (ECB) also opted to cut its interest rates by 25 basis points.

The Bank of Canada (BoC) is widely anticipated to implement a significant interest rate cut of 50 basis points at its upcoming monetary policy meeting on Wednesday. Recent inflation data suggests that both the Bank of England (BoE) and the Reserve Bank of New Zealand (RBNZ) may consider potential rate cuts next month. Additionally, the US Federal Reserve (Fed) is expected to lower interest rates by 50 basis points by the end of 2024.

Regarding the US elections, markets appear optimistic about Republican nominee Donald Trump winning the 2024 presidential election. Trump's fiscal and trade policies are viewed as inflationary and favorable for the US Dollar (USD), which could negatively impact Silver demand. A stronger US Dollar makes Silver more expensive for buyers using foreign currencies, potentially dampening their purchasing power.