**BREAKING: Silver Extends Losses to Third Day on Fed Rate Hike Concerns**
Silver prices dropped to around $57.60 per troy ounce during Tuesday’s Asian trading session, marking the third consecutive day of losses for XAG/USD. The precious metal is under pressure as surging oil prices are amplifying market expectations that the Federal Reserve may maintain its hawkish stance on interest rates longer than previously anticipated.
The correlation between rising energy costs and monetary policy expectations is creating headwinds for non-yielding assets like silver. Higher oil prices typically fuel inflation concerns, potentially forcing the Fed to keep rates elevated or even implement additional hikes to control price pressures. This environment makes yield-free precious metals less attractive compared to interest-bearing instruments.
Traders and precious metals dealers should monitor upcoming Fed communications closely, as any confirmation of extended tight monetary policy could accelerate silver’s decline. The energy sector’s trajectory will be critical in shaping near-term rate expectations.
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FXnCO Insight
** Position defensively in precious metals while oil remains elevated, as the Fed-inflation narrative currently outweighs safe-haven demand for silver.
Source: FXStreet