Silver (XAGUSD) Forecast: Tariff Shock Slams Prices—$31.81 in Sight?

Silver Sinks as Trade Tensions and Tariff Fallout Pressure Demand

Silver prices plunged Thursday as market participants reacted to technical weakness and a deepening global trade war, sending the metal into a key support zone. Spot silver fell below the critical $33.62 pivot, triggering a sell-off that brought prices to their lowest level since March 11 and pushed the market into a confluence of long-term support at $32.53—where both the 61.8% Fibonacci retracement and 50-day moving average converge.

Traders are watching this zone closely. A technical bounce is possible here, but a decisive break would expose further downside toward $31.81 and potentially the 200-day moving average near $30.89. The sell-off coincided with a collapse in risk sentiment driven by President Trump’s aggressive new tariff regime.

At 11:33 GMT, XAGUSD is trading $32.44, down $1.45 or -4.27%.

Tariffs Target Semiconductor Demand, Weigh on Silver

Silver’s industrial demand outlook took a hit after the U.S. announced a baseline 10% tariff on nearly all imports and much higher duties on specific trading partners. Semiconductors—one of silver’s key industrial applications—are now at the center of trade uncertainty, with targeted tariffs reducing the demand outlook from major manufacturers. Markets in China, Japan, and Europe sold off sharply, while U.S. futures turned negative as investors reassessed growth risks and inflation pressure.

Fitch Ratings noted the effective U.S. import tax rate has jumped to 22%, the highest in over a century. China now faces tariffs of up to 54%, while U.S. allies like Japan, South Korea, and the EU are contending with rates between 20–32%. These measures threaten to choke global trade flows, spurring concerns about a broader economic slowdown.

Gold Rally Caps Silver Sentiment

Safe-haven buying initially surged on the tariff news, pushing gold to a new all-time high of $3,167.84. However, gold later reversed intraday as the White House clarified that key commodities—including gold and copper—would be exempt from tariffs. That announcement curbed some of the bullish momentum in precious metals, including silver, and helped drive a pullback.

While gold’s overall uptrend remains intact, Thursday’s reversal highlights the challenge for silver, which lacks the same safe-haven support and remains heavily tied to industrial demand expectations.

Silver Outlook: Pressure Mounting, Support Critical

With trade tensions mounting and global manufacturing facing fresh headwinds, silver remains vulnerable. If the $32.53 support zone fails, traders should anticipate a quick test of $31.81, followed by deeper losses if the broader market sell-off continues. Tariffs targeting semiconductors are particularly bearish for silver’s demand base, and without a rebound in sentiment or a reversal in trade policy, rallies are likely to be sold.

Short-term, silver will need to hold the $32.53 level to avoid accelerating downside pressure. Traders should remain cautious and monitor headline risk around tariff negotiations and industrial demand indicators.

More Information in our Economic Calendar.