Silver Corrects Despite Rising Geopolitical Risks!
Silver prices (XAG/USD) weakened on Monday (April 20th), trading around $79.25 per troy ounce, down 1.90% from $80.80 on Friday. However, this figure is still up 11.77% since the start of the year.
At the same time, geopolitical dynamics are shaping market sentiment. According to several sources, US-Iran tensions have escalated again after the US seized an Iranian cargo ship and Tehran announced retaliation. The market is also highlighting risks around the Strait of Hormuz, which are driving energy prices and inflation concerns.
The correlation to silver isn't always "risk-off = silver up." In this episode, hedging flows were more concentrated in the US dollar, while inflation concerns stemming from the energy boom boosted interest rate and yield expectations, putting pressure on the non-yielding precious metal. The combined effect of a stronger dollar and yields could weaken the XAG/USD despite rising geopolitical risks.
This relative reflection is evident in the gold/silver ratio, which rose to 60.32 from 59.78 on Friday, indicating that silver has lagged behind gold in recent movements. Going forward, the market will monitor the direction of tensions in the region, the response of the dollar and yields, and whether the gold/silver ratio continues to rise or declines again as safe-haven preferences shift. (asd)
Source: Newsmaker.id
