Silver Price in India Rises 2% Following Correction in Crude Oil and US Dollar Easing

Silver Prices Rebound in India as Oil Prices Easing and Dollar Weakness Improve Metal's Appeal

Silver prices in India bounced back on Wednesday, snapping a two-day losing streak due to easing oil prices and a softer dollar, which improved the metal's appeal. The move came after U.S. President Donald Trump announced an extension of the Iran ceasefire, reducing immediate fears of an inflation spike and aggressive interest rate moves.

The MCX Silver price jumped 2% or over ₹4,800 to ₹2,49,423 per kg, while MCX Gold rate added 1.3% or over ₹2,000 to ₹1,53,699 per 10 grams. Globally, spot silver rose 1.5% to $77.84 per ounce, tracking gains across the precious metals complex.

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The rally in silver also tracked a recovery in gold, which rose 0.9% to $4,755.11 per ounce after hitting its lowest level since April 13 in the previous session. U.S. gold futures climbed 1.1% to $4,772.90, signaling broader strength across the metals complex.

However, uncertainty persists due to the extension appearing unilateral, with no immediate confirmation from Iran or U.S. ally Israel. Iran has also said it will not reopen the Strait of Hormuz while U.S. blockades remain in place, keeping oil supply concerns alive. Oil prices reacted to the development, with Brent crude holding near $100 per barrel, while the U.S. dollar slipped as much as 0.2% after gains in the previous session.

Other precious metals also moved higher, with platinum rising 1.5% to $2,067.25 and palladium gaining 1.8% to $1,560.31. At the heart of silver's rebound is a decline in the U.S. dollar, which makes silver cheaper for buyers holding other currencies, boosting demand.

A weaker dollar and cooling oil prices reduce fears of a sharp rise in inflation, which in turn lowers expectations of prolonged high interest rates. While crude prices remain elevated near $100 per barrel due to ongoing supply disruptions, the immediate risk of further escalation has eased. This has reduced the urgency around inflation fears, indirectly supporting silver.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Interest rate expectations remain a crucial piece of the puzzle, with Federal Reserve chief nominee Kevin Warsh stating that he had made no commitments to cut rates, reinforcing the idea that policy decisions will remain data-dependent. Geopolitics continues to play a role, with tensions remaining unresolved despite the ceasefire extension.

For now, the rebound suggests that investors are not abandoning silver, but rather recalibrating positions as the macro environment evolves.