Silver Price on MCX Declines Amid Strengthening Dollar, Crude Oil Surge, and US Fed Rate Hike Concerns

Silver Prices Ease as Stronger U.S. Dollar and Rising Oil Prices Dampen Investor Sentiment

In India, silver prices declined on Friday, weighed down by a stronger U.S. dollar and rising oil prices, which dampened investor sentiment. Investors remained cautious amid persistent inflation concerns and expectations of further monetary tightening by the U.S. Federal Reserve. Geopolitical tensions surrounding U.S.-Iran negotiations also kept market sentiment cautious, supporting safe-haven demand for precious metals.

On the Multi Commodity Exchange (MCX), silver prices fell 0.5% to ₹2,73,266 per kg, while MCX Gold declined 0.5% to ₹1,58,816 per 10 grams. In the spot market, silver prices dropped 0.7% to $76.18 per ounce by 0222 GMT. Despite the decline in the latest session, the white metal was still headed for a weekly gain of around 0.4%, outperforming gold during the week.

The precious metals market remained volatile as traders reacted to a stronger U.S. dollar and rising Treasury yields. The dollar hovered near a six-week high, making dollar-priced commodities more expensive for holders of other currencies and limiting buying interest in silver and gold. Silver also came under pressure from rising bond yields as investors increasingly priced in the possibility of another interest rate hike by the U.S. Federal Reserve later this year. Higher interest rates generally reduce the appeal of non-yielding assets like silver and gold because investors tend to shift toward interest-bearing instruments.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Note: The table above compares the silver prices on MCX and in the spot market, as well as the weekly gain in silver prices.