Strong Dollar Pushes Silver Down to $73
Silver Prices Fall in International Market; Domestic Rates Also Decline: Silver prices continued their decline on Wednesday, February 18th. Silver prices in the international market fell to $72 per ounce. Although they recovered somewhat later, prices remained around $73 per ounce. This represents a decline of 0.54 percent from the previous close.
Silver futures on the Multi-Commodity Exchange (MCX) closed at ₹2,30,204 per kg. This represents a rise of 0.62 percent from the previous session. However, international cues, profit-booking, and rising volatility kept prices under pressure.
The Indian Bullion and Jewellers Association reported the benchmark price of silver at ₹2,32,955 per kg for the 6:30 pm session on February 17. This represents a decline of 3.32 percent in the last 24 hours.
Why is silver falling?
Experts say that silver is under pressure due to a decline in safe-haven demand. News of potential nuclear talks between the US and Iran has eased global tensions. Furthermore, news of new talks between Ukraine and Russia has also improved risk sentiment in the market.
When geopolitical tensions decrease, investors shift money from safe-haven options like gold and silver to other assets.
The strengthening of the dollar was also negative news for silver. Internationally, silver and gold are priced in dollars. When the dollar strengthens, these metals appear more expensive, which could reduce demand.
Expert Ross Maxwell says the market is currently anticipating the possibility of future interest rate cuts. If major economies signal rate cuts, real interest rates will fall. This could benefit non-interest-bearing assets like gold and silver.
However, he cautioned that if interest rates remain high for a prolonged period or the dollar strengthens further, precious metals could remain under pressure.
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