With oil prices falling, interest rate hikes slowing, and inflation receding—three major positive factors at play—silver prices still fell. What happened?
2026-07-06 13:48:06
On Monday (July 6) during Asian trading hours, spot silver prices fell by about 1%, trading around $61.80 per ounce, ending a four-day winning streak.
However, market analysts believe that silver is likely to regain its upward momentum soon, mainly because the market generally expects oil prices to fall further, a scenario that will help to further ease global inflation expectations.
In recent months, energy supply disruptions caused by the Middle East conflict have driven oil prices sharply higher, putting continuous and intense selling pressure on silver. Now, the expectation of a decline in oil prices is providing silver with some breathing room.
Citigroup analysts noted in a report that Brent crude oil could fall further to $60 per barrel by the end of this year.
The core logic is that as the risk of shipping disruptions in the Strait of Hormuz gradually subsides and maritime traffic gradually returns to normal, fundamental factors in the crude oil market are rapidly regaining dominance.
Brent crude futures traded in a narrow range during Asian trading hours, currently down slightly and trading around $71.90 per barrel.
Meanwhile, after the release of the non-farm payroll data by the U.S. Department of Labor last Thursday, market expectations for further interest rate hikes by the Federal Reserve slightly declined, a change that also provided support for silver prices.
According to the CME Group's FedWatch tool, the market is betting on a 53.2% probability of the Federal Reserve raising interest rates at least once more before the end of September, down from 59.4% a week earlier. This easing of rate hike expectations has somewhat alleviated pressure on silver, a non-interest-bearing asset.
Looking ahead, investors will be closely watching the minutes of the Federal Open Market Committee's June policy meeting, to be released on Wednesday (July 8), for further clues about the outlook for U.S. interest rates.
This summary may provide clearer guidance for the short-term direction of silver.
Goldman Sachs expects the average price range for spot silver to be $85-$100 per ounce for the whole year.
The organization positions silver as a core strategic metal for the global energy transition and green technology revolution, emphasizing its irreplaceable role in high-growth areas such as photovoltaic power generation, electric vehicle battery components, 5G infrastructure, and AI data center cooling systems.
Goldman Sachs analysts believe that industrial demand will continue to expand strongly in 2026, coupled with limited growth in mine production and relatively stable contributions from recycled silver, the structural supply shortage will persist, thus providing solid downward support for spot prices.
UBS believes that spot silver will fluctuate widely for the remainder of 2026. While industrial demand remains resilient, overall slowdown in growth will weaken upward price momentum. UBS also predicts that prices may further retrace to around $75 in March 2027.
UBS recognizes the strategic value of silver in the energy transition and long-term industrial applications, and advises investors to pay attention to changes in physical market inventories and macroeconomic policy signals.
From a technical perspective, silver is currently facing clear selling pressure, mainly due to the mean reversion pullback after the price rebounded to near the 20-day exponential moving average (63.20).
The Relative Strength Index (RSI) is currently hovering around 42. It had just rebounded from the weak range of 20 to 40, indicating that although the downward momentum has cooled down, the overall bearish pattern has not yet been reversed.
(Spot silver daily chart, source: EasyForex)
At 13:47 Beijing time on July 6, spot silver was trading at $61.73 per ounce.
However, market analysts believe that silver is likely to regain its upward momentum soon, mainly because the market generally expects oil prices to fall further, a scenario that will help to further ease global inflation expectations.
In recent months, energy supply disruptions caused by the Middle East conflict have driven oil prices sharply higher, putting continuous and intense selling pressure on silver. Now, the expectation of a decline in oil prices is providing silver with some breathing room.
Citigroup is bearish on Brent crude oil to $60, citing fundamental factors as the renewed dominance.
Citigroup analysts noted in a report that Brent crude oil could fall further to $60 per barrel by the end of this year.
The core logic is that as the risk of shipping disruptions in the Strait of Hormuz gradually subsides and maritime traffic gradually returns to normal, fundamental factors in the crude oil market are rapidly regaining dominance.
Brent crude futures traded in a narrow range during Asian trading hours, currently down slightly and trading around $71.90 per barrel.
A slight cooling of expectations for a Federal Reserve rate hike also provided support for silver prices.
Meanwhile, after the release of the non-farm payroll data by the U.S. Department of Labor last Thursday, market expectations for further interest rate hikes by the Federal Reserve slightly declined, a change that also provided support for silver prices.
According to the CME Group's FedWatch tool, the market is betting on a 53.2% probability of the Federal Reserve raising interest rates at least once more before the end of September, down from 59.4% a week earlier. This easing of rate hike expectations has somewhat alleviated pressure on silver, a non-interest-bearing asset.
Markets are focused on this week's Federal Reserve meeting minutes.
Looking ahead, investors will be closely watching the minutes of the Federal Open Market Committee's June policy meeting, to be released on Wednesday (July 8), for further clues about the outlook for U.S. interest rates.
This summary may provide clearer guidance for the short-term direction of silver.
Institutional Views
Goldman Sachs expects the average price range for spot silver to be $85-$100 per ounce for the whole year.
The organization positions silver as a core strategic metal for the global energy transition and green technology revolution, emphasizing its irreplaceable role in high-growth areas such as photovoltaic power generation, electric vehicle battery components, 5G infrastructure, and AI data center cooling systems.
Goldman Sachs analysts believe that industrial demand will continue to expand strongly in 2026, coupled with limited growth in mine production and relatively stable contributions from recycled silver, the structural supply shortage will persist, thus providing solid downward support for spot prices.
UBS believes that spot silver will fluctuate widely for the remainder of 2026. While industrial demand remains resilient, overall slowdown in growth will weaken upward price momentum. UBS also predicts that prices may further retrace to around $75 in March 2027.
UBS recognizes the strategic value of silver in the energy transition and long-term industrial applications, and advises investors to pay attention to changes in physical market inventories and macroeconomic policy signals.
Technical Analysis: The 20-day moving average forms a key resistance level.
From a technical perspective, silver is currently facing clear selling pressure, mainly due to the mean reversion pullback after the price rebounded to near the 20-day exponential moving average (63.20).
The Relative Strength Index (RSI) is currently hovering around 42. It had just rebounded from the weak range of 20 to 40, indicating that although the downward momentum has cooled down, the overall bearish pattern has not yet been reversed.
(Spot silver daily chart, source: EasyForex)
At 13:47 Beijing time on July 6, spot silver was trading at $61.73 per ounce.
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