Silver Prices Remain Stable at ₹2.68 Lakh per Kg Amid US-Iran Ceasefire Extension

Precious Metals Rise as US Dollar Remains Under Pressure

Silver prices in India were steady on Friday, 29 May, despite a weaker US dollar as investors evaluated reports of a possible extension of the ceasefire between the United States and Iran. The MCX Silver price fell 0.5% to ₹2,68,018 per kg, while the MCX gold price was flat at ₹1,56,316 per 10 grams.

Spot silver rose 0.7% to $76.17 per ounce in early trade, while gold prices also edged higher, with spot gold gaining 0.4% to $4,512.79 per ounce as of 0113 GMT. The yellow metal has advanced about 0.1% so far this week. Meanwhile, US gold futures climbed 0.2% to $4,543.10 per ounce.

The gains in precious metals came as the US dollar remained under pressure against major global currencies. The greenback was on track to end the week lower after reports suggested that Washington and Tehran had reached an agreement to extend the ceasefire in the Middle East and remove restrictions on shipping through the Strait of Hormuz.

Read also: Gold and Silver Prices Decline Amid Strengthening Dollar and Inflation Concerns

A weaker dollar typically supports precious metals because it makes commodities priced in US currency cheaper for holders of other currencies, thereby boosting demand. Gold had fallen to a two-month low on Thursday before recovering and ending the session higher after reports emerged that the ceasefire agreement between the US and Iran could be extended.

According to reports, the United States and Iran reached an agreement on Thursday to prolong the ceasefire and restore shipping access through the Strait of Hormuz. However, uncertainty remains as US President Donald Trump has not yet approved the arrangement, while Iranian state media reported that the agreement has not been finalised.

While easing geopolitical tensions reduced demand for traditional safe-haven assets such as the US dollar, investors remained cautious about whether a lasting resolution could be achieved. Mixed messages from Washington and Tehran earlier in the week have kept markets wary of further developments.

Read also: Gold and Silver Prices in India: A Review of Current Rates Across Major Cities

The prospect of smoother shipping flows through the Strait of Hormuz also weighed on oil prices, which moved lower following the reports. However, traders remain focused on the broader inflation outlook, which continues to be shaped by energy prices and central bank policy expectations.

Recent economic data shows that US inflation accelerated in April at its fastest pace in three years. The increase was largely driven by higher energy prices linked to the Iran conflict, reinforcing expectations among economists that the Federal Reserve may keep interest rates unchanged well into next year.

For gold and silver investors, the inflation picture presents a mixed outlook. While precious metals are often viewed as a hedge against inflation, higher inflation can also lead to tighter monetary policy and higher interest rates, which tend to reduce the appeal of non-yielding assets such as gold and silver.

Adding to those concerns, St. Louis Federal Reserve President Alberto Musalem said the central bank may need to raise interest rates if inflation does not resume its downward trajectory over the next six months. That comment highlighted the growing tension between easing geopolitical risks and persistent inflation pressures.

While hopes of a ceasefire extension have improved market sentiment and weakened the dollar, concerns about future Federal Reserve policy continue to limit the upside for precious metals. For now, traders are likely to remain focused on three major factors: developments surrounding the US-Iran ceasefire agreement, movements in the US dollar, and signals from Federal Reserve officials on the future path of interest rates. These factors are expected to play a crucial role in determining the near-term direction of both gold and silver prices.