Silver was volatile on Tuesday. The market saw a correction after hitting a new all-time high earlier in the week.
The initial surge was driven by robust safe-haven demand amid US-China trade risks, political instability across major economies, and growing expectations of further Federal Reserve rate cuts.
While Trump hinted at possible negotiations with China, the uncertainty could help maintain silver’s appeal as a defensive asset and limit downside risks.
Meanwhile, political risks, including the prolonged US government shutdown, the political unrest in France and leadership uncertainty in Japan, could continue to fuel safe-haven flows.
From a monetary perspective, markets are pricing in two 25-basis-point cuts by the Fed before year-end, further painting a bullish scenario for the precious metal. In this regard, markets could react to Powell’s speech later today. In parallel, tightening supply in London’s physical silver market and persistent industrial demand could keep the fundamental outlook constructive.
