- The price of silver fights while the Trump administration adds several Chinese semiconductor companies to its black export list.
- The demand for sure shelter for precious metals, including silver, has weakened before relaxation signs of global commercial tensions.
- The bassist potential of La Plata could be limited as the US dollar weakens after economic data that has increased the probabilities of fed rates cuts.
La Plata (XAG/USD) is going back from its recent profits observed in the previous session, around $ 32.50 during Friday’s Asian negotiation hours. The metal is under pressure, possibly due to a report by the Financial Times that indicates that the Trump administration plans to add several Chinese semiconductor companies to its black export list, known as the “entity list.” The growing connection of silver with the chips manufacturing industry – due to its essential role in the production of electronics and semiconductors – is amplifying market sensitivity to such developments.
Meanwhile, the demand for sure shelter for precious metals, including silver, has softened with relaxation signs of global commercial tensions. It is reported that the US and China have reached a preliminary agreement to significantly reduce tariffs. According to the proposed agreement, the US would reduce tariffs on Chinese imports from 145% to 30%, while China would cut their tariffs on US goods from 125% to 10%. This progress is considered a positive movement towards the de -escalation of commercial friction between the two economic powers.
Despite the recent setback, the bassist potential of La Plata can be limited as the US dollar (USD) weakens after economic data that increased the expectations of possible federal reserve (Fed) rate cuts in the short term. The lowest interest rates in the US generally support silver prices, since they reduce the opportunity cost of keeping non -generating active active such as precious metals.
However, the president of the FED, Jerome Powell, warned that inflation could become more unpredictable due to more frequent supply crashes, which could complicate the Fed’s efforts to maintain price stability in the future.
FAQS SILVER
Silver is a highly negotiated precious metal among investors. Historically, it has been used as a value shelter and an exchange means. Although it is less popular than gold, operators can resort to silver to diversify their investment portfolio, for their intrinsic value or as a possible coverage during periods of high inflation. Investors can buy physical silver, in coins or bullion, or negotiate it through vehicles such as the funds quoted in the stock market, which follow their price in international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can cause the price of silver to shoot due to its safe refuge status, although to a lesser extent than that of gold. As an asset without performance, silver tends to climb with lower interest rates. Its movements also depend on how the US dollar (USD) behaves, since the asset is quoted in dollars (XAG/USD). A strong dollar tends to maintain the price of silver at bay, while a weaker dollar probably drives rising prices. Other factors such as investment demand, mining – silver supply is much more abundant than gold – and recycling rates can also affect prices.
Silver is widely used in the industry, particularly in sectors such as electronics or solar energy, since it has one of the highest electrical conductivities of all metals, surpassing copper and gold. An increase in demand can increase prices, while a decrease tends to reduce them. The dynamics in US economies, China and India can also contribute to price fluctuations: for the US and particularly China, its large industrial sectors use silver in several processes; In India, the demand for consumers for precious metal for jewelry also plays a key role in pricing.
Silver prices tend to follow gold movements. When gold prices go up, silver typically follows the same path, since their status as shelter is similar. The gold/silver ratio, which shows the number of ounces of silver necessary to match the value of an ounce of gold, can help determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that silver is undervalued, or that gold is overvalued. On the contrary, a low ratio could suggest that gold is undervalued in relation to silver.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
