Silver Slides Near $34.00 On Profit-Taking
Silver (XAG/USD) prices faced selling pressure to around $34.15 after falling from a near seven-month high during Asian trading hours on Tuesday (03/06). The white metal weakened on profit-taking amid easing trade tensions.
The generally positive tone in equity markets weighed on safe-haven assets, including the white metal. US President Donald Trump is planning to double tariffs on steel and aluminum imports, starting Wednesday. On the same day, the Trump administration asked its trading partners to submit their best offers to complete the deals before July 8. However, the downside potential of XAG/USD may be limited amid tariffs and economic uncertainty.
The greenback weakened after data showed that US manufacturing contracted for a third month in May. This, in turn, could help limit losses in the USD-denominated commodity prices. The US Manufacturing Purchasing Managers’ Index (PMI) fell to 48.5 in May compared to 48.7 previously, the Institute for Supply Management (ISM) revealed on Monday. This reading was below the market consensus of 49.5.
Traders will be closely watching the release of the US employment report for May on Friday. This report could provide some clues about the US economy and the path of interest rates. The US Nonfarm Payrolls (NFP) is expected to show a jobs growth of 130K in May, while the Unemployment Rate is projected to hold steady at 4.2% during the same reporting period. If the data shows stronger than expected, it could boost the greenback and weaken the precious metal.
Source: FXStreet
