Silver Struggles at $70 as Middle East Tensions, Fed Policy Bite

Silver hovered around $70 per ounce on Tuesday, oscillating between small gains and losses amid mixed signals on a Middle East diplomatic breakthrough. While President Trump delayed US strikes on Iran, citing "positive talks", a claim Tehran rejected as "psychological warfare", reports hinted at possible indirect negotiations. Tensions escalated further as the Wall Street Journal reported that Saudi Arabia and the UAE may join the conflict, and an Israeli official told CNN that a ceasefire remains "out of reach" due to Iran’s unwillingness to compromise. Israel’s Defense Minister reiterated plans to "continue striking Iran with full force." The metal stayed near its lowest level since December, pressured by rising energy prices and inflation concerns. With Fed rate cuts now off the table for 2026, traders are preparing for additional tightening from other key central banks.

Silver traded above $69 per ounce on Tuesday, shifting between gains and losses amid heightened Middle East tensions as Iran denied holding talks with the US to end the conflict. Tehran dismissed President Donald Trump’s announcement as an attempt to influence financial markets while launching new attacks on US targets, with Israel also continuing strikes against Iran and Lebanon. On Monday, silver had staged a sharp intraday rebound after Trump postponed planned US strikes on Iranian energy infrastructure and claimed negotiations were underway. The outcome of any talks and the potential reopening of the Strait of Hormuz remain highly uncertain, keeping inflation risks elevated. Silver had fallen as much as 37% from its March peak as rising energy prices stoked inflation concerns and reinforced expectations of further interest rate hikes.

Silver traded around $68 per ounce on Tuesday after a sharp intraday rebound in the previous session, as investors weighed the postponement of US strikes on Iranian energy infrastructure and the potential for negotiations to end the conflict. President Donald Trump’s announcement of a five-day delay in planned strikes was seen as an effort to manage oil prices, with benchmarks plunging about 10%. The dollar and Treasury yields also eased following the announcement, providing additional support to precious metals. However, Tehran denied that any negotiations were underway, while Israel continued its attacks on Iran. The outcome of any talks and the potential reopening of the Strait of Hormuz remain uncertain, keeping inflation risks elevated. Silver had fallen as much as 37% from its March peak as rising energy prices stoked inflation concerns and reinforced expectations of further interest rate hikes.