Silver prices hit by stronger dollar and risk-on sentiment

Silver prices fell toward $30 per ounce on Thursday, approaching their lowest levels in two months, as a stronger dollar and renewed risk-on sentiment pulled investors away from precious metals.

Silver prices hit by stronger dollar and risk-on sentiment

The rally in equities, cryptocurrencies, and the dollar gained momentum following Donald Trump's election victory last week, with markets anticipating robust economic growth and higher inflation under the new administration. Meanwhile, recent US inflation data aligned with forecasts, leaving little impact on expectations for Federal Reserve policy adjustments.

Investor sentiment's effect

In China, investor sentiment was dampened by Beijing's modest support measures to bolster the economy, despite new tax incentives for property transactions announced by the finance ministry on Wednesday. Additionally, silver, which plays a crucial role in solar panel manufacturing, faced headwinds due to concerns over China's lack of aggressive stimulus, further clouding the outlook for industrial demand in the sector.