Silver prices tumbled sharply during Asian trading hours Friday, dropping 2.5% to hover near $56.50 per ounce as traders digest increasingly hawkish Federal Reserve signals. The precious metal broke through the $55.60 support level, marking a fresh downward leg that reflects broader pressure on non-yielding assets amid rising interest rate expectations.
The selloff comes as market participants recalibrate portfolios following recent Fed commentary suggesting policymakers remain committed to aggressive rate hikes to combat persistent inflation. Higher interest rates typically strengthen the dollar and increase opportunity costs for holding precious metals like silver, which generate no yield. The white metal is particularly vulnerable given its dual role as both an industrial commodity and safe-haven asset.
Traders across commodity desks, precious metals brokers, and forex markets are watching key support levels closely as volatility picks up. The breakdown below $55.60 could signal further downside momentum if Fed officials maintain their hawkish stance in upcoming speeches.
FXnCO Insight
Watch dollar strength and upcoming Fed speakers closely—continued hawkish rhetoric could push silver toward the next support zone near $55.00.
Source: FXStreet