XAG/USD Falls Below $30.50 Due to Easing Middle-East Tensions
Silver price (XAG/USD) extends its losses for the second successive session, trading around $30.30 per troy ounce during the Asian hours on Monday. The safe-haven metal faces challenges due to easing tensions in the Middle East. On Sunday, Hamas and Israel exchanged hostages and prisoners, marking the first day of a ceasefire after 15 months of conflict.
Hamas released three female hostages in exchange for 90 Palestinians imprisoned in Israel, according to Bloomberg. In turn, for the three Israeli hostages freed, Hamas agreed to release 90 prisoners and detainees, all of whom were expected to be women and children, as reported by the Commission of Prisoners' Affairs.
Traders adopt a cautious approach ahead of President-elect Donald Trump’s inauguration later in the day. His proposed trade tariffs are expected to drive inflation, potentially triggering trade wars and increasing Silver’s appeal as a hedge against inflation.
Concerns are growing over Trump’s policy proposals, such as potential tariffs, tax cuts, and the deportation of undocumented immigrants. Analysts suggest that the US Federal Reserve’s (Fed) future interest rate decisions will largely depend on how these policies are implemented.
Softer-than-expected US inflation data from last week has rekindled expectations of further rate cuts by the Federal Reserve this year. Lower rates reduce the opportunity cost of holding non-interest-bearing Silver, thereby enhancing its appeal.
Source : Fxstreet
