Silver price rebounds strongly to near $68.20 as Trump pauses strikes on Iran’s power plants
Silver price recovers strongly as Trump instructs to pause military strikes on Iranian power plants.
Trump’s announcement has boosted investors’ risk appetite and has weakened USD’s safe-haven demand.
Traders might raise dovish bets for global central banks if oil prices continue to remain lower.
Silver price ($XAG
/USD) bounces back strongly to near $68.20 during the European trading session on Monday. The white metal recovers its early losses and turns marginally positive, following the announcement from United States (US) President Donald Trump through a post on Truth.Social that he has instructed the Department of War to pause military attacks on Iranian power plants for five days.
“I am pleased to report that the United States of America, and the country of Iran, have had, over the last two days, very good and productive conversations regarding a complete and total resolution of our hostilities in the Middle East. Based on the tenor and tone of these in depth, detailed, and constructive conversations, which will continue throughout the week, I have instructed the Department of War to postpone any and all military strikes against Iranian power plants and energy infrastructure for a five-day period, subject to the success of the ongoing meetings and discussions.” Trump wrote.
Trump’s announcement of a pause on scheduled attacks on Iranian power plants has resulted in a sharp improvement in investors’ risk appetite, leading to a significant decline in the US Dollar (USD) and the oil price.
As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades almost flat around 99.50 after giving back its early losses.
Theoretically, safe-haven assets, such as the Silver price, carry a negative relation with market sentiment. However, the Silver price has rebounded strongly as it was declining in the past few weeks, with accelerating hopes of tightening monetary conditions by global central banks due to surging oil prices.
Speculation that global central banks would adopt an extended pause on interest rates or raise them would ease if the oil price continues to decline. WTI oil price has fallen significantly from its intraday high of $100.10 below $90.00 at the press time.
Earlier in the day, the Silver price plummeted 10% to near $61.00 as Iran vowed retaliation against US President Trump’s threats to bomb Iran’s power plants.
