Middle East tensions and inflation concerns drove silver prices higher, with prices stabilizing above $80.
2026-05-11 16:08:18
On Monday during Asian trading hours, spot silver (XAG/USD) continued its recent strong performance, trading around $80.70 , marking its fourth consecutive day of gains. Amid the ongoing deterioration of the situation in the Middle East, safe-haven demand and inflation concerns have risen simultaneously, pushing precious metal prices to remain at high levels overall.
US President Trump formally rejected Iran's latest peace proposal, describing it as "completely unacceptable." Meanwhile, Iran stated its desire to end the regional conflict and restore shipping safety in the Strait of Hormuz, but did not provide a clear timetable for its reopening. Due to persistent differences between the two sides on issues such as nuclear programs and ceasefire conditions, market concerns about a further escalation of the Middle East situation have intensified significantly. Some market institutions point out that the global market has re-entered a "safe-haven trading" mode, with precious metals and the US dollar both receiving inflows. At the same time, shipping risks in the Strait of Hormuz have resurfaced, and international energy prices continue to rise. Markets are concerned that if energy prices remain high, global inflationary pressures could intensify again. Rising energy costs are reinforcing global market expectations of "high interest rates lasting longer." The recent rebound in international crude oil prices has further fueled market concerns about global central banks maintaining tight monetary policies.
US employment data further reinforced this logic. Data from the US Bureau of Labor Statistics showed that non-farm payrolls increased by 115,000 in April, lower than the previous month's 185,000, but significantly higher than the market expectation of 62,000; the unemployment rate remained at 4.3% . Following the data release, market bets on a near-term interest rate cut by the Federal Reserve decreased significantly. Market analysts believe that although the US job market has cooled somewhat, the overall economic resilience remains strong, and the Federal Reserve still has room to maintain a hawkish stance.
Meanwhile, the European Central Bank (ECB) continues to send hawkish signals. The market currently expects a greater than 90% probability of a 25 basis point rate hike by the ECB in June, with a potential for three rate hikes by the end of 2026. The expectation of high interest rates maintained by major central banks globally is putting some pressure on non-yielding precious metals. Since silver itself does not generate interest income, its investment attractiveness is typically affected by persistently high interest rates. Furthermore, the recent strengthening of the US dollar index is also putting temporary pressure on silver. As safe-haven funds flow back into dollar assets, the dollar index has regained its footing above the 98 level. A stronger dollar means that dollar-denominated silver is more expensive for overseas buyers, which may weaken some physical demand and speculative buying. However, silver has not seen a significant decline, mainly due to market safe-haven demand and its industrial applications.
Some institutions believe that against the backdrop of escalating global geopolitical risks, silver, as a precious metal with both safe-haven and industrial properties, still has certain investment value.
From a technical perspective, the daily chart for silver shows that the overall price is still maintaining a strong upward structure. After stabilizing around $76 , the bullish momentum has continued to strengthen. On the daily chart, silver has been trading above the 20-day moving average for several consecutive trading days, indicating a continued strong medium-term trend. The MACD indicator remains high, with the red bars continuing to expand, reflecting that bullish momentum still dominates the market. The RSI indicator remains around 70, approaching the overbought zone, indicating strong short-term buying interest, but also suggesting the risk of a technical pullback. The $79.20 area currently forms the first key support level on the daily chart; a break below this level could lead to a further pullback to around $77.80. On the upside, the $81.50 to $82.30 area has formed a significant short-term resistance zone. If the situation in the Middle East continues to deteriorate, silver prices may have the opportunity to challenge higher levels.
Furthermore, given that current market sentiment is highly dependent on developments in the Middle East, silver's short-term volatility may increase significantly. As long as risk aversion remains high, silver's overall medium-term uptrend is likely to continue.
Editor's Summary : The silver market is currently in a complex tug-of-war between "safe-haven demand" and "high interest rate pressure." The continued deterioration of the Middle East situation is driving safe-haven funds into the precious metals market, while inflation concerns stemming from rising energy prices are further supporting silver prices at high levels. However, stronger-than-expected US employment data and the continued hawkish stance of global central banks are reinforcing market expectations of prolonged high interest rates, coupled with a strengthening US dollar index, putting temporary downward pressure on silver. From a technical perspective, silver maintains its overall medium-term strong upward trend, but it is approaching overbought territory in the short term, and the market needs to be wary of the risk of high-level consolidation and technical correction. Going forward, the market will need to focus on the Middle East situation, the US dollar index trend, and changes in global central bank policies.
US President Trump formally rejected Iran's latest peace proposal, describing it as "completely unacceptable." Meanwhile, Iran stated its desire to end the regional conflict and restore shipping safety in the Strait of Hormuz, but did not provide a clear timetable for its reopening. Due to persistent differences between the two sides on issues such as nuclear programs and ceasefire conditions, market concerns about a further escalation of the Middle East situation have intensified significantly. Some market institutions point out that the global market has re-entered a "safe-haven trading" mode, with precious metals and the US dollar both receiving inflows. At the same time, shipping risks in the Strait of Hormuz have resurfaced, and international energy prices continue to rise. Markets are concerned that if energy prices remain high, global inflationary pressures could intensify again. Rising energy costs are reinforcing global market expectations of "high interest rates lasting longer." The recent rebound in international crude oil prices has further fueled market concerns about global central banks maintaining tight monetary policies.
US employment data further reinforced this logic. Data from the US Bureau of Labor Statistics showed that non-farm payrolls increased by 115,000 in April, lower than the previous month's 185,000, but significantly higher than the market expectation of 62,000; the unemployment rate remained at 4.3% . Following the data release, market bets on a near-term interest rate cut by the Federal Reserve decreased significantly. Market analysts believe that although the US job market has cooled somewhat, the overall economic resilience remains strong, and the Federal Reserve still has room to maintain a hawkish stance.
Meanwhile, the European Central Bank (ECB) continues to send hawkish signals. The market currently expects a greater than 90% probability of a 25 basis point rate hike by the ECB in June, with a potential for three rate hikes by the end of 2026. The expectation of high interest rates maintained by major central banks globally is putting some pressure on non-yielding precious metals. Since silver itself does not generate interest income, its investment attractiveness is typically affected by persistently high interest rates. Furthermore, the recent strengthening of the US dollar index is also putting temporary pressure on silver. As safe-haven funds flow back into dollar assets, the dollar index has regained its footing above the 98 level. A stronger dollar means that dollar-denominated silver is more expensive for overseas buyers, which may weaken some physical demand and speculative buying. However, silver has not seen a significant decline, mainly due to market safe-haven demand and its industrial applications.
Some institutions believe that against the backdrop of escalating global geopolitical risks, silver, as a precious metal with both safe-haven and industrial properties, still has certain investment value.
From a technical perspective, the daily chart for silver shows that the overall price is still maintaining a strong upward structure. After stabilizing around $76 , the bullish momentum has continued to strengthen. On the daily chart, silver has been trading above the 20-day moving average for several consecutive trading days, indicating a continued strong medium-term trend. The MACD indicator remains high, with the red bars continuing to expand, reflecting that bullish momentum still dominates the market. The RSI indicator remains around 70, approaching the overbought zone, indicating strong short-term buying interest, but also suggesting the risk of a technical pullback. The $79.20 area currently forms the first key support level on the daily chart; a break below this level could lead to a further pullback to around $77.80. On the upside, the $81.50 to $82.30 area has formed a significant short-term resistance zone. If the situation in the Middle East continues to deteriorate, silver prices may have the opportunity to challenge higher levels.
Furthermore, given that current market sentiment is highly dependent on developments in the Middle East, silver's short-term volatility may increase significantly. As long as risk aversion remains high, silver's overall medium-term uptrend is likely to continue.
Editor's Summary : The silver market is currently in a complex tug-of-war between "safe-haven demand" and "high interest rate pressure." The continued deterioration of the Middle East situation is driving safe-haven funds into the precious metals market, while inflation concerns stemming from rising energy prices are further supporting silver prices at high levels. However, stronger-than-expected US employment data and the continued hawkish stance of global central banks are reinforcing market expectations of prolonged high interest rates, coupled with a strengthening US dollar index, putting temporary downward pressure on silver. From a technical perspective, silver maintains its overall medium-term strong upward trend, but it is approaching overbought territory in the short term, and the market needs to be wary of the risk of high-level consolidation and technical correction. Going forward, the market will need to focus on the Middle East situation, the US dollar index trend, and changes in global central bank policies.
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