XAG/USD edges higher as Moody’s downgrade forces USD lower
Silver (XAG/USD) is trading slightly higher on Monday, holding above the $32.00 level during the US session, as broader weakness in the US Dollar (USD) fuels demand for alternative safe-haven assets. The move comes in response to Moody’s downgrade of US sovereign credit, which has added to market concerns over fiscal sustainability and long-term growth prospects.
At the time of writing, Silver prices are up 0.05% on the day, with spot XAG/USD last seen around $32.30. The metal is attempting to reclaim the 50-day Simple Moving Average near $32.75, which has capped gains in recent sessions.
On Friday, Moody’s Investors Service downgraded the United States' sovereign credit rating from AAA to AA1, citing growing concerns over ballooning debt levels, policy uncertainty and the long-term impact of high interest rates. This marks the final major agency to strip the US of its top-tier credit rating, raising alarm over its fiscal path and potential long-term drag on economic growth.
In the aftermath, the US Dollar has come under renewed pressure, with the US Dollar index (DXY) slipping as investors reassess the Greenback's standing as the world’s preeminent safe-haven currency.
With Silver priced in US Dollars, the relative weakness of the USD has bolstered the appeal of precious metals.
Source : Fxstreet
