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Silver Price Forecast: XAG/USD posts modest gains near $36.00 on weaker US Dollar

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Silver Price Forecast: XAG/USD posts modest gains near $36.00 on weaker US Dollar

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New update 2025.06.25 13:08
Silver Price Forecast: XAG/USD posts modest gains near $36.00 on weaker US Dollar

update 2025.06.25 13:08

  • Silver price trades with mild gains around $35.95 in Wednesday's Asian session. 
  • The weaker US Dollar provides some support to the USD-denominated Silver. 
  • The risk-on mood due to easing Middle East tension might cap the XAG/USD's upside. 

The Silver price (XAG/USD) posts modest gains near $35.95 during the Asian session on Wednesday. The weaker US Dollar (USD) provides some support to the USD-denominated commodity price. Traders brace for Federal Reserve's (Fed) Chair Jerome Powell testifies later on Wednesday.

US consumer confidence fell again in June amid uncertainty about US President Donald Trump's trade policies. Data released by the Conference Board on Tuesday showed that the US Consumer Confidence Index dropped to 93 in June, below the market consensus. The downbeat US economic data drag the US Dollar lower and benefit the Silver price. 

On the other hand, the truce between Iran and Israel appeared to hold, with both sides saying they would honor the ceasefire if the other side did the same. Investors expect a truce between both countries will reduce the fears of wider war, which dampens the alternative safe-haven assets like Silver. 

Investors will closely monitor the developments surrounding the Israel-Iran conflict. Israeli Prime Minister Benjamin Netanyahu said the country would strike again if Iran rebuilds its nuclear project. Any signs of escalation could boost the white metal in the near term. 

Silver FAQs

Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.

Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply - Silver is much more abundant than Gold - and recycling rates can also affect prices.

Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals - more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers' demand for the precious metal for jewellery also plays a key role in setting prices.

Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.


Date

Created

 : 2025.06.25

Update

Last updated

 : 2025.06.25

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