Silver (XAG/USD) climbed on Tuesday, trading around $70.30 per ounce with a modest 0.6% gain. The rally extended as investors adjusted positions ahead of the Federal Reserve’s monetary policy decision later Wednesday.
Market focus also remained on US-Iran diplomatic developments. US President Donald Trump indicated the agreement text would be released soon and expressed optimism that the Strait of Hormuz would fully reopen by Friday. Meanwhile, Hezbollah officials reported receiving assurances from Tehran that no final nuclear deal would proceed without Israeli withdrawal from Lebanon.
The improving geopolitical backdrop reduced safe-haven demand, though precious metals remained supported as investors awaited further details before repositioning. Lower oil prices also contributed to steady market sentiment, potentially easing global inflation pressures and giving central banks more flexibility in policy decisions.
The US Dollar faced continued pressure, with recent data showing private sector job growth averaging just 25,500 per week over the four weeks ending May 30—down from 29,000 previously. This slower hiring pace reinforced expectations of a more moderate labor market, limiting dollar strength.
A weaker dollar enhanced silver’s appeal for international investors. Market attention now centers on the Fed’s statement and updated economic projections for signals on interest rate direction. Like gold, silver typically benefits from lower rates due to its non-yielding nature, with any indication of no rate hikes this year likely supporting prices in coming weeks.
