A 25% tariff on steel and aluminum imports by former President Donald Trump will create fear of a wider trade war, which could revive demand for safe shelters for gold.
Silver will gain industry demand, but face the strength of the dollar
Silver (XAG/USD) is stable at $31.82, with an intraday high of $31.94, as industrial demand expectations provide some support.
Unlike gold, silver benefits from manufacturing and economic expansion, particularly in major global markets. However, the strong US dollar and Powell's remarks limit the benefits of silver.
Silver could face more headwinds if inflation data indicates persistent price pressure. However, by mitigating inflation, supporting recovery and enhancing silver's dual purpose asset, it is valuable both as a safe haven and its industrial use.
Investors await inflation data for clues to the Fed's policy
With gold under pressure and Silver struggling to get higher intrusions, traders are focusing on future US consumer inflation reports. Analysts hope that this data will have a significant impact on the next policy decision of the Federal Reserve.
If inflation is high, the dollar could be further strengthened, potentially lowering the prices of gold and silver. Conversely, softer inflation can spark new interest in precious metals.
