Silver Slips in Futures Trade on Strong Dollar, Escalating West Asia Crisis

New Delhi: Silver futures remained under pressure for the fifth straight session, declining Rs 1,705 to Rs 2.33 lakh per kilogram on Thursday as investors shifted towards the US dollar amid escalating tensions in West Asia and lingering concerns over inflation.

On the Multi Commodity Exchange, the white metal for July delivery depreciated by Rs 1,705, or 0.72 per cent, to Rs 2,33,800 per kilogram in a business turnover of 11,600 lots.

Analysts said a strong US dollar and elevated Treasury bond yields continued to reduce the demand for precious metals.

Gold prices came under heavy pressure, falling nearly 1 per cent as investors favoured the dollar amid escalating tensions between Washington and Tehran and higher US inflation data, Manav Modi, Commodities Analyst at Motilal Oswal Financial Services Ltd, said.

In the international markets, Comex silver futures for the July contract dipped 1.48 per cent to trade at USD 63.78 per ounce in New York.

Modi noted that market sentiment deteriorated after fresh US military strikes on Iranian targets and increasingly aggressive rhetoric from President Donald Trump, who warned that Iran would “pay the price” for delaying a peace agreement and signalled further military action if negotiations continued to stall.

The ongoing closure of the Strait of Hormuz has intensified concerns over global energy supplies, keeping oil prices elevated and sustaining fears of energy-driven inflation, he added.

According to analysts, market participants are closely tracking the US Producer Price Index (PPI) report later in the day and comments from Federal Reserve officials for fresh signals on the interest-rate trajectory and the near-term direction of precious metal prices.