Silver (XAG) Daily Forecast: Geopolitical Tensions Push Prices to $30.80; Buy Now?

Economic Data and Monetary Policy on Silver Prices

Recent robust U.S. economic data and hawkish Federal Reserve statements have reduced expectations for interest rate cuts, with markets now anticipating only one cut by year-end. This has influenced investor strategies, impacting assets, including cryptocurrencies, as the Fed may maintain current rates longer to address inflation.

U.S. Durable Goods Orders rose by 0.7% in April, contrary to the expected 0.8% decline. The University of Michigan’s Consumer Sentiment Index increased to 69.1 in May, exceeding forecasts. One-year inflation expectations edged up to 3.3%, while five-year expectations dipped to 3.0%. These factors have strengthened the U.S. dollar, putting pressure on silver prices.

Looking ahead, U.S. banks close for Memorial Day, with key Fed speeches and first-quarter GDP data expected to influence the market. Positive GDP data may further strengthen the dollar, affecting silver prices.

Geopolitical Tensions & Silver Prices

On the geopolitical front, Gaza’s Ministry of Health reported Israeli airstrikes on a displaced people’s camp in Rafah, resulting in at least 35 Palestinian deaths and numerous injuries. Israel stated it targeted a Hamas compound, killing two senior members.

Sirens in Tel Aviv signalled rocket attacks claimed by Hamas, prompting ceasefire talks and hostage negotiations to resume on Tuesday. Meanwhile, diplomatic pressure on Israel mounts, especially after the International Court of Justice ordered a halt to its offensive in Gaza.

These geopolitical tensions between Israel and Hamas are boosting safe-haven demand for silver as investors seek refuge from market uncertainty.

Short-Term Forecast

Silver prices are expected to remain volatile amid geopolitical tensions and strong U.S. economic data. The price, trading around $30.80, shows potential for upward movement above $30.61, with resistance at $30.97.