Silver Price Forecast: XAG/USD rises to near $78.00 on safe-haven demand
Silver gains as safe-haven demand rises amid ongoing US-Iran tensions.
US-Iran talks remain unresolved, with Tehran claiming a general framework agreement on a possible nuclear deal.
Dollar-denominated Silver may be capped as the firm US Dollar follows hawkish Fed signals.
Silver price (XAG/USD) extends its gains for the second successive session, trading around $78.00 per troy ounce during the Asian hours on Thursday. The precious metal Silver receives support from rising safe-haven demand amid persistent tensions between the United States (US) and Iran.
US-Iran talks remain unresolved, with Tehran citing a “general agreement” on the framework of a potential nuclear deal with US officials. Vice President JD Vance said Iran failed to meet US red lines, while President Donald Trump reiterated that military action remains an option. Reports indicate any US strike could turn into a prolonged campaign, with Israel advocating regime change in the Islamic Republic.
Meanwhile, Ukraine and Russia ended two days of peace talks in Geneva without progress. President Volodymyr Zelenskiy accused Moscow of stalling US-led efforts to end the four-year conflict. Trump has repeatedly pressed Ukraine to accept a deal that may involve significant concessions, as Russian forces continue striking energy infrastructure and advancing on the battlefield.
However, gains in dollar-denominated Silver may be capped as the US Dollar (USD) stays firm amid hawkish signals from the Federal Reserve (Fed). A stronger Greenback often reflects higher US yields, increasing the opportunity cost of holding non-yielding assets like Silver. The grey metal also becomes more expensive for holders of other currencies, reducing global demand.
Federal Open Market Committee (FOMC) Minutes from the January meeting revived speculation about potential rate hikes if inflation remains elevated. While most policymakers supported keeping rates unchanged, only a few favored a cut, and officials indicated they could ease policy if inflation moderates as expected. Traders modestly pared Fed rate cut bets but still expect two 25 basis points reductions before year-end.
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