Silver Price Forecast: XAG/USD Retreats Towards $33.00 on Risk-On Sentiment

Silver Price Forecast: XAG/USD Retreats Towards $33.00 Area on Risk-On Markets

Silver prices (XAG/USD) declined by over 1% on Monday, pressured by a relatively stronger US Dollar and an improving global risk appetite. Optimism surged after US President Donald Trump postponed his plan to impose 50% tariffs on imports from the European Union, easing fears of escalating trade tensions and their negative impact on global economic growth. This boosted investor confidence and reduced demand for safe-haven assets such as precious metals.

Despite the US Dollar’s partial recovery, concerns over the growing US national debt and fiscal health are expected to limit the currency’s upside potential. Moody’s downgrade of the US credit rating, coupled with expectations of the upcoming Senate debate on a sweeping tax bill projected to add trillions to the US debt, have increased fears of a worsening debt crisis. This "Sell America" sentiment weighed heavily on the US Dollar last week.

As a result, the US Dollar may struggle to extend its gains, providing some support for silver prices. The metal is likely to find short-term support in the $32.90 to $33.00 region, where buyers may step in. Traders will be watching closely for further developments in US fiscal policy and global trade dynamics, as these factors will continue to influence silver price movements in the near term.