New Delhi, May 12 (PTI) Silver prices pared early gains to trade nearly 1 per cent lower at Rs 2.76 lakh per kilogram in futures trade on Tuesday as renewed US-Iran tensions dampened investors’ appetite
for precious metals ahead of Washington’s inflation data.
On the Multi Commodity Exchange, the white metal for the July delivery declined by Rs 1,346, or 0.48 per cent, to Rs 2,76,965 per kg in a business turnover of 7,451 lots.
Traders said bullion trade turned volatile after US President Donald Trump rejected Tehran’s latest counter-proposal to Washington’s peace framework, reviving fears that efforts to end the conflict may stall.
The diplomatic setback renewed concerns over stability in the Strait of Hormuz, where shipping activity remains severely restricted despite a ceasefire announced in April to facilitate negotiations, they added.
In the international markets, Comex silver futures for the July contract slipped 1.24 per cent to USD 84.88 per ounce in New York.
Analysts said market participants are increasingly concerned that prolonged tensions in West Asia could keep crude oil prices elevated, reinforcing inflationary pressures and strengthening the case for higher-for-longer interest rates from the US Federal Reserve and other major global central banks.
Renisha Chainani, Head of Research at Augmont, said market expectations for two interest rate cuts by the US Federal Reserve (Fed) in 2025 have weakened considerably, with consensus now divided between one and no easing through 2026.
Investors are tracking Trump’s visit to China for high-level discussions with his Chinese counterpart Xi Jinping, where the Iran crisis, energy security, nuclear proliferation, and trade are expected to feature prominently.
China remains the largest importer of Iranian crude oil and a key ally of Tehran.
At the same time, markets are now awaiting US consumer inflation data due later in the day for fresh signals on the Fed’s interest-rate outlook, with expectations of prolonged tight monetary policy continuing to weigh on precious metals. PTI HG HG BAL BAL
