Silver Price Forecast: XAG/USD holds losses below $33.00 as safe-haven demand weakens

• Silver's safe-haven appeal has diminished as global trade tensions ease.

• US lowers tariffs on Chinese goods from 145% to 30%, while China reduces its reciprocal tariffs from 125% to 10%.

• Markets are dialing back expectations for aggressive Fed rate cuts, further weighing on demand for Silver.

Silver price (XAG/USD) Oil price halts its four-day winning streak, trading around $32.80 per troy ounce during the European hours on Wednesday. The metal’s safe-haven appeal has weakened amid easing global trade tensions.

Reports indicate that the US and China have reached a preliminary agreement to substantially reduce tariffs. Under the proposed terms, the US would lower tariffs on Chinese goods from 145% to 30%, while China would reduce its tariffs on US imports from 125% to 10%. This development is widely seen as a positive step toward de-escalating trade tensions between the two economic giants.

Further boosting sentiment, US President Donald Trump told Fox News that the US is working to expand market access in China and described US-China relations as “excellent.” Trump also signaled a willingness to engage in direct talks with President Xi Jinping in pursuit of a broader trade agreement.

As geopolitical risks recede, markets are scaling back expectations for aggressive Federal Reserve (Fed) rate cuts, putting additional pressure on safe-haven demand for Silver. However, weaker-than-expected US consumer inflation data for April provided some support for precious metals, as the US Dollar (USD) softened, making Silver more attractive to non-dollar holders.

April’s inflation numbers marked a three-year low in annual headline CPI, though analysts believe it may be the last subdued reading for some time, with new US tariffs on major trade partners set to take effect in May. Market focus now shifts to upcoming data releases, including the US Producer Price Index (PPI) and the University of Michigan’s Consumer Sentiment Survey.

According to the US Bureau of Labor Statistics, the Consumer Price Index (CPI) rose 2.3% year-over-year in April, slightly below March’s 2.4% and market forecasts. Core CPI, excluding food and energy, climbed 2.8% annually, in line with expectations. Both headline and core CPI rose 0.2% on a monthly basis.