Silver prices have struggled due to reduced safe-haven demand following a ceasefire between Israel and Iran. The announcement by Trump brought the price of Silver (XAG/USD) down to around $36.10 per troy ounce during Asian trading on Tuesday.

The truce is set to begin with Iran immediately and Israel after 12 hours, following missile activity at the Al Udeid Air Base in Qatar. The ceasefire calmed geopolitical tensions, impacting demand for Silver and other precious metals.

Federal Reserve Vice Chair Michelle Bowman indicated support for a potential interest rate cut in July to address rising risks to the job market. Bowman noted that inflation is edging back to 2%, downplaying concerns over tariffs on inflation.

Fed Governor Christopher Waller suggested the central bank might ease monetary policy soon, contingent on improving labour and inflation data. Jerome Powell will provide insights on interest rates during his testimony before the US Congress.

Silver’s demand is influenced by various factors including geopolitical instability, industrial usage, and the performance of the US Dollar. As a non-interest-bearing asset, its prices are typically buoyed by lower interest rates and inventory demand in sectors like electronics and solar energy.

With recent conflict de-escalation in the Middle East, the expected rush to safety appears to have softened—at least in the short term. The announcement of a ceasefire, beginning immediately on one side and with a slight delay on the other, has taken immediate pressure off precious metals. We’ve seen Silver fall accordingly, slipping to around $36.10 per troy ounce. That response isn’t surprising, given Silver’s traditional role during periods of instability. Reduced urgency for havens typically means lower demand for the metal.

Reduced tensions aren’t the only factor shaping the price. Attention has now turned squarely toward US monetary policy. With Bowman suggesting July might bring a shift in rates, and Waller showing a similar openness—although tied to how labour and inflation measures perform—it’s becoming harder to discount the potential for currency-side moves in metals pricing. The US Dollar’s performance has a direct link here. If the Fed decides to loosen, that softening in the Dollar may lift Silver again, even without a renewed geopolitical spark.

Powell is set to speak soon, and clarity from him could alter expectations quickly. Traders will be watching—and perhaps even more so listening—for any tone that leans toward easing. It’s not just about the remarks themselves but which data points they emphasise. Consistent messaging around job market fragility or cooling inflation would reinforce current speculation.

The diminishing impact of tariffs, mentioned by Bowman, adds another layer. That’s one inflation input less likely to sway the Fed toward caution. So, if the data doesn’t rebound fast enough, their hand may be pushed earlier.

For now, we’re in a limbo that offers chances—particularly if positioning is nimble. Any fresh unrest, whether economic or political, could revive demand for Silver. But even absent that, softer policy could do the job. The strong correlation between rate expectations and non-yielding assets shouldn’t be overlooked.

Industrial signals matter here too, especially demand from sectors like solar tech and electronics manufacturing. If those remain stable—or pick up in line with easing borrowing costs—Silver’s support won’t only rest on geopolitics or central bankers. Increased inventory replenishment could provide an alternate lift.

We’ll be watching Powell’s testimony for any clues, but immediate action may not be essential. Often it’s the tone, the slight shift in emphasis, that tells you more than outright declarations. Understanding that will help guide positions more effectively than reacting to the headlines alone.