The power of the Greenback is supported by cautious market positioning and safe port flows into American assets. The dollar index climbed above 103.60 and dampened the question of the precious metal in the short term. However, the wider story still supports Gold’s benefit.
FED chairman Jerome Powell recently confirmed the plans for two 25-basic point reductions at the end of the year, with market prices that indicate a probability of 65% to relax from June, according to CME Fedwatch.
Silver softened, but the basic principles remain firm
Silver (XAG/USD) was also confronted with sales pressure, trading almost $ 33.13 after reaching an intra-day low of $ 32.97.
While the strength of the dollar weighed on the metal, the outlook of Silver remains supported by the same macro factors that are based on gold: persistent geopolitical instability and expectations of looser monetary policy.
Geopolitical risks support the demand for safe haven
Rising tensions in Eastern Europe have added a risk period to the global markets. Russia and Ukraine remain locked up in escalating military fairs, including drone attacks focused on strategic infrastructure. In the meantime, diplomatic efforts remain behind closed doors, with us and Russian officials expected to meet each other in Saudi Arabia for de-escalation talks.
Although the short strength strength in the dollar limits upward limit for precious metals, analysts claim that a long -term environment of geopolitical stress and policy of the central bank in the central bank should continue to favor gold and silver.