Silver (XAG/USD) price is falling to around $75.00 in Monday’s Asian trading session from an all-time high of $84.03 hit in the opening trading hours. The white metal gave up its intraday gains and turned slightly negative as US President Donald Trump signaled progress in peace talks between Russia and Ukraine.
US President Donald Trump and Ukrainian President Volodymyr Zelensky said after a meeting in Florida, earlier in the day, that an agreement on the pace of work in Ukraine is close to being reached, indicating some key issues that have not yet been resolved, such as how much territory Ukraine will hand over to Russia, and the future of Ukraine’s Zaporizhzhia nuclear power plant, which is currently under Russian control, the BBC reported.
Signs of easing geopolitical tensions often reduce the appeal of safe haven assets, such as silver.
Meanwhile, the silver price outlook remains firm amid headlines pointing to Chinese export restrictions on the precious metal and strong expectations that the Federal Reserve (US central bank) will deliver more interest rate cuts in 2026 than expected at the policy meeting announced in mid-December.
Beijing has announced new restrictions on silver exports, effective January 1, 2026, limiting the ability of small exporters to sell the white metal abroad, raising global supply concerns. Chinese authorities have said that silver exporters must obtain government licences, with eligibility limited to large, state-certified companies that meet strict production and financing thresholds.
In response, Tesla leader Elon Musk strongly condemned Beijing’s decision, highlighting the demand for silver across various industries. “This is not good. Silver is needed in many industrial processes,” Musk, now X, wrote on Twitter.
The CME FedWatch tool shows that the odds of the Fed cutting interest rates by at least 50 basis points in 2026 are 73.3%. However, the Fed’s bullet chart showed that policymakers collectively see the federal funds rate heading to 3.4% by the end of 2026, suggesting there will be no more than one rate cut.
Frequently asked questions about silver
Silver is a precious metal that is widely traded among investors. It has been used historically as a store of value and medium of exchange. Although less popular than gold, traders may turn to silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during periods of high inflation. Investors can buy physical silver, in the form of coins or bullion, or trade it through instruments such as exchange-traded funds, which track its price in international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession could cause the price of silver to rise due to its safe-haven status, although to a lesser extent than the price of gold. As a non-yielding asset, silver tends to rise as interest rates fall. Its movements also depend on how the US dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong dollar tends to keep the price of silver at bay, while a weak dollar is likely to push prices higher. Other factors such as investment demand, mining supplies – silver is more plentiful than gold – and recycling rates can also influence prices.
Silver is widely used in industry, especially in sectors such as electronics or solar energy, as it has one of the highest electrical conductivity of all metals – more than copper and gold. A rise in demand can cause prices to rise, while a fall tends to bring them down. Dynamics in the economies of the United States, China and India can also contribute to price fluctuations: for the United States, and especially China, its large industrial sectors use silver in various processes; In India, consumer demand for the precious metal used in jewelery also plays a major role in determining prices.
Silver prices tend to follow gold movements. When gold prices rise, silver usually follows suit, as its status as a safe haven asset is similar. The gold/silver ratio, which shows how many ounces of silver are needed to equal the value of one ounce of gold, may help determine the relative valuation between the two metals. Some investors may consider a high ratio to be an indication that silver is undervalued, or that gold is undervalued. Conversely, a low ratio may indicate that gold is undervalued compared to silver.
