Silver Rises, Trump Comments and Iran Signals Maintain Market Volatility

Silver (XAG/USD) strengthened during Tuesday's European trading session, rising around 1.85% to near $76.30. The rally occurred as oil prices corrected, while uncertainty surrounding US-Iran relations kept the market sensitive to geopolitical headlines.

At the same time, WTI oil fell around 1.8% to near $89.20. Since the Middle East conflict began, silver has been seen moving inversely to oil as high energy prices boost US inflation expectations and make the market more likely to delay projections for a Federal Reserve interest rate cut. When oil weakens, inflationary pressures are perceived to ease, providing support for the precious metal.

The oil correction followed comments by US President Donald Trump on Monday indicating he had pressured Israel to halt attacks on Hezbollah in Lebanon. However, tensions remained high after several Iranian officials condemned the Israeli attacks and warned of consequences for both the US and Israel, maintaining uncertainty in asset pricing.

On the diplomatic front

On the diplomatic front, the chances of a US-Iran deal being reached anytime soon are again questionable. The Tasnim news agency reported on Monday that Tehran's negotiating team had suspended communication with the US through mediators in response to the escalation of the conflict in Lebanon. This situation has kept the market holding a risk premium, although silver's daily movements are largely influenced by oil dynamics and interest rate expectations.

The focus next shifts to US employment data. Investors await the release of JOLTS job openings data for April at 14:00 GMT (9:00 PM WIB). The BLS is expected to report 6.82 million jobs, a slight decrease from 6.866 million in March. This data will be closely watched for insights into the direction of the labor market and its implications for Fed policy, before the week's main focus shifts to the release of US Nonfarm Payrolls (NFP) for May on Friday.

-Silver (XAG/USD) rose 1.85% to near $76.30 during the European session on Tuesday.

-WTI fell 1.8% to around $89.20; a decline in oil prices supported the precious metal.

-US-Iran uncertainty and developments in the Lebanon conflict are keeping volatility high.

-The market is awaiting US JOLTS data (released at 9:00 PM WIB) for clues on the Fed's policy outlook.

-This week's focus continues on the US May Nonfarm Payrolls (NFP) data

-This week's focus continues on the US May Nonfarm Payrolls (NFP) data, released Friday. (gn)

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