Silver Prices Weaken as US Dollar Gains Strength

Precious metals faced headwinds on Thursday, with silver prices declining as the US dollar strengthened. The shift in sentiment was primarily driven by economic data from the United States that altered expectations for monetary policy, placing pressure on non-yielding assets.

• The spot price for silver traded near $83.50 per troy ounce, representing a decline of approximately 1%.
• Market expectations for the next Federal Reserve interest rate cut have shifted, with July 2026 now seen as a more likely timeline than June.
• The US Dollar Index (DXY) advanced to 96.94 points.
• Traders are anticipating the next potential catalyst: the release of the US Consumer Price Index (CPI) data on Friday.

A Shift in Macroeconomic Expectations

The catalyst for the day's downturn was a surprisingly robust US labor market report for January 2026. Data indicated the strongest job creation in over a year, accompanied by an unexpected drop in the unemployment rate. This points to continued economic resilience, reducing the immediate pressure on the Federal Reserve to lower borrowing costs.

Consequently, investors are repricing the timeline for monetary easing. The prospect of sustained higher interest rates for a longer period tends to bolster the US dollar, as seen in the DXY's climb. A firmer dollar makes dollar-denominated commodities like silver more expensive for holders of other currencies, dampening demand.

Trading Dynamics and Forward Outlook

During the session, silver trended lower in both Asian and European trading. On the MCX, India's commodities exchange, the March 2026 futures contract briefly fell below 260,000 rupees per kilogram after testing higher levels earlier.

Some market participants attributed part of the sell-off to profit-taking following a recent rally, which was then amplified by the changed US interest rate outlook.

Should investors sell immediately? Or is it worth buying Silber Preis?

Despite the near-term pressure, the broader narrative for silver in 2026 remains supported by fundamental factors. Analysts, including those referenced by the LBMA, forecast a wide trading range for the year. This view is underpinned by structural supply deficits and robust industrial demand, particularly from the photovoltaic sector.

All attention now turns to the upcoming US CPI report. This inflation data will be crucial in determining whether the current corrective phase in silver continues or if signs of persistent price pressures renew investor interest in precious metals as a hedge.

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