Silver Prices Rebound Ahead of US Inflation Data, Markets Wary of Fed Moves
Silver prices (XAG/USD) strengthened again on Tuesday morning in Europe, approaching $38.50 per troy ounce after a dip in the previous session. This rebound brought silver closer to its 14-year high of $39.13, reached on Monday. The price increase occurred due to traders' perception of caution ahead of the release of US inflation data for June, which could influence the direction of the Federal Reserve's (Fed) interest rate policy.
Who is fueling market concerns? Fed Chairman Jerome Powell, who stated that inflation could rise over the summer, primarily due to tariff pressures. This led investors to speculate that interest rate cuts might be delayed until later in the year. The situation became further complicated after US President Donald Trump again criticized Powell, saying that interest rates should have been lowered to 1% or even lower.
Furthermore, global trade tensions began to ease after Trump stated his readiness to open further tariff negotiations with the European Union and other partner countries. However, they remain. The US government on Monday immediately imposed a 17% tariff on fresh tomato imports from Mexico, after trade talks between the two countries failed to reach an agreement.
Meanwhile, demand for safe-haven assets like silver remained high due to escalating geopolitical tensions. Trump threatened to impose "very heavy" tariffs on Russia if a peace agreement is not reached within 50 days. Along with NATO Secretary General Mark Rutte, Trump also announced that European countries would purchase American weapons, including Patriot missile systems, which will be delivered to Ukraine in the coming weeks.
Source: (ayu-newsmaker)
