Silver Price Holds Steady Amid Strengthening Dollar and Rising Oil Ahead of US Federal Reserve Meeting

Global Markets in Focus as Investors Await Clarity on US-Iran Peace Talks

The silver rate remained largely steady on Tuesday, 28 April, as investors waited for clarity on stalled peace talks between the United States and Iran. The ongoing Middle East conflict is also prompting investors to assess the global interest rate outlook, with central banks scheduled to make key decisions this week.

The MCX silver rate shed 0.5% to ₹2,40,490 per kg, while the MCX gold price remained unchanged at ₹1,51,555 per kg. In the spot market, silver declined 0.8% to $74.91 per ounce, while gold prices edged lower, with spot gold down 0.1% to $4,679.06 per ounce as of 0217 GMT. U.S. gold futures for June delivery remained steady at $4,693.20.

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The decline in precious metal prices came as the dollar strengthened and crude oil prices extended gains, with the key Strait of Hormuz largely shut, tightening supply expectations. Higher crude oil prices tend to push inflation higher by increasing transportation and production costs, which in turn raises the likelihood of elevated interest rates.

Although gold is typically seen as a hedge against inflation, higher interest rates reduce its appeal by making yield-bearing assets more attractive. On the geopolitical front, uncertainty persists after Donald Trump expressed dissatisfaction with Iran's latest proposal to resolve the ongoing two-month conflict, according to a U.S. official.

The lack of progress has dampened hopes for a resolution, with the conflict continuing to disrupt energy supplies, fuel inflation, and resulting in significant casualties. Investors are now closely watching the outcome of the Federal Reserve's two-day policy meeting, which concludes on Wednesday, where rates are widely expected to remain unchanged.

Market participants are also tracking decisions from other major central banks, including the Bank of Japan, European Central Bank, and the Bank of England, for further cues on the global monetary policy path.

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According to Renisha Chainani, Head - Research at Augmont, the overall sentiment toward bullion remains cautious. A firmer dollar and rising Treasury yields are increasing the opportunity cost of holding gold. The key upcoming catalysts are the Fed's April 29 rate decision, US Q1 GDP data on April 30, and any definitive progress in US-Iran diplomacy.

For silver, Chainani noted that prices are consolidating in the range of $73 (₹2,35,000) and $82 (₹2,58,000). Either a side breakout or breakdown will give a further price move. Technically, gold faces resistance at $4,850 (₹1,55,000). A confirmed break above this level could open a path toward $5,000 (₹1,60,000). Immediate support is established at $4,650 (₹1,51,000).