Silver Market Analysis: Price Forecast and Influencing Factors

Date: July 10, 2025

Author: James Hyerczyk

Key Highlights

• Silver prices are holding steady at $36.30, supported by expectations of Federal Reserve rate cuts and a weakening dollar.
• Recent Fed minutes indicate a likelihood of rate cuts, which has lowered Treasury yields, enhancing the appeal of non-yielding assets like silver.
• President Trump's tariff policies are contributing to inflation concerns, further supporting silver prices.
• The dollar's decline, as indicated by a drop in its global reserve share, is making silver more affordable for international buyers.

Current Market Conditions

As of the latest trading session, silver (XAG/USD) is priced at $36.64, reflecting a 0.71% increase. The market is currently focused on the $36.30 support level, which has been defended for four consecutive days. This stability is attributed to the easing dollar and bullish sentiment in the precious metals market.

Federal Reserve Rate Cut Expectations

The minutes from the Federal Reserve's June meeting suggest that officials are leaning towards rate cuts later in the year, despite maintaining current rates in the last meeting. This has resulted in a decrease in the 10-year Treasury yield to 4.342%, which lowers the opportunity cost of holding silver and gold, thus bolstering their market appeal.

Impact of Tariffs on Inflation

President Trump's recent tariff increases, particularly a 50% levy on copper imports and goods from Brazil, have reignited inflation fears. While the broader equity markets remain stable, the potential for supply-driven inflation could enhance demand for silver, especially as disruptions in copper supply may affect industrial demand for silver.

Dollar Weakness and Its Effects

The U.S. dollar index has decreased by 0.2%, influenced by the International Monetary Fund's report showing a decline in the dollar's share of global reserves to 57.7%. This decline makes silver less expensive for buyers using other currencies, thereby supporting its price around the $36.30 mark.

Price Outlook and Trading Strategy

Traders are currently monitoring the $36.30 pivot for support, with potential upside targets around $37.32. A confirmed breakout above this level could trigger further buying momentum. Conversely, a drop below $36.30 may lead to a test of lower support levels between $35.40 and $34.87, with the 50-day moving average at $34.80 serving as a potential buying opportunity.

Conclusion

The silver market is currently in a consolidation phase, with future price movements likely dependent on upcoming signals from the Federal Reserve and developments related to inflation driven by tariff policies. Traders should remain vigilant for catalysts that could influence market direction.