Silver Surges Above $33.00 Amid Safe-Haven Demand and US Fiscal Uncertainty

Silver Price Outlook: XAG/USD Soars Above $33.00, Buoyed by Safe-Haven Buying

Silver prices have rebounded, rising above the $33.00 mark during Friday’s Asian trading session. The precious metal recovered from losses exceeding 1% recorded in the previous session, driven by rising safe-haven demand amid growing fiscal concerns in the United States.

Safe-Haven Demand Supports Silver

Despite fiscal deficit worries weighing on commodities like silver, the metal has attracted buying interest as investors seek safe-haven assets amidst uncertainty. Silver, known for its dual role as both a precious metal and an industrial commodity, is sensitive to shifts in economic sentiment and risk appetite.

Impact of Trump’s Budget Bill

Adding to market volatility, President Donald Trump’s "One Big Beautiful Bill" passed the US House of Representatives by a razor-thin margin of one vote and is now headed to the Senate. According to the Congressional Budget Office (CBO), the bill would increase the fiscal deficit by approximately $3.8 billion, largely due to proposed tax relief measures on tip income and US-made car loans.

This development has fueled concerns over the US fiscal deficit, increasing the appeal of safe-haven metals like silver even as some sectors face challenges.

Challenges for Silver Demand from the Solar Industry

On the demand side, silver faces headwinds from the solar photovoltaic industry, a significant consumer of the metal. Uncertainties surrounding US tariffs and mixed economic data have dampened momentum in the solar sector, impacting industrial demand for silver.

Silver’s extensive industrial applications, including electronics, solar panels, and automotive parts, mean that it remains sensitive to shifts in both economic policy and industrial activity.

Outlook

The silver market remains influenced by a complex interplay of safe-haven buying, fiscal policy developments, and industrial demand trends. Traders will be watching the upcoming US Senate discussions on the budget bill and broader economic indicators to gauge silver’s near-term trajectory.