Silver Price Forecast: Fails to Hold Above $80 as US Inflation Fears Pressure Metals
Silver prices turned lower at the start of the week as traders focused on a stronger U.S. dollar and the upcoming U.S. CPI report, which could heavily influence interest rate expectations.
Quick overview
- Silver prices declined as traders reacted to a stronger U.S. dollar and anticipated U.S. CPI data, which may impact interest rate expectations.
- The recent rally in silver was short-lived, retreating below key resistance levels amid concerns over inflation and interest rates.
- Geopolitical tensions with Iran have added volatility to the markets, particularly regarding the Strait of Hormuz and nuclear negotiations.
- Silver's price dynamics are influenced by industrial demand, making it sensitive to broader economic trends and growth forecasts.
Live SILVER Chart
Silver prices turned lower at the start of the week as traders focused on a stronger U.S. dollar and the upcoming U.S. CPI report, which could heavily influence interest rate expectations.
Silver Rally Reverses Ahead of CPI
Silver posted a strong recovery last week, briefly surging above the key $8 level on Thursday as momentum improved across precious metals. However, the rally quickly faded, with prices retreating lower into Monday’s Asian session and slipping back below that major resistance zone.
The reversal came as the U.S. dollar strengthened sharply, rising nearly 1% and putting pressure on metals markets. The move highlighted how fragile silver’s recent breakout attempt remains, particularly with investors becoming increasingly cautious ahead of this week’s critical U.S. inflation data.
Markets now appear concerned that a hotter-than-expected CPI report could reinforce expectations for higher interest rates, which would likely weigh further on non-yielding assets such as silver.
Iran Tensions Continue to Drive Volatility
Geopolitical tensions returned to focus over the weekend after Iranian state-linked media reported that Tehran is seeking sovereignty over the Strait of Hormuz, one of the world’s most strategically important oil shipping routes.
At the same time, tensions between Washington and Tehran intensified after President Trump publicly rejected Iran’s latest nuclear proposals, calling them “totally unacceptable.”
Iran responded sharply through Tasnim News Agency, where sources linked to negotiations dismissed Trump’s comments as irrelevant and insisted Iran’s negotiating position would not change to satisfy Washington.
Key Iran Headlines
- Iran reportedly seeks sovereignty over the Strait of Hormuz
- President Trump rejected Tehran’s latest proposals
- Iranian officials dismissed U.S. criticism publicly
- Markets fear renewed escalation in the Middle East
The increasingly public nature of the dispute has added another layer of uncertainty to already fragile global markets.
Inflation Data Becomes Key Catalyst
This week’s U.S. CPI report is now the main focus for traders.
Key Economic Data This Week
U.S. CPI (Tuesday):
- Headline CPI expected at 0.6% M/M
- Core CPI expected at 0.4% M/M
- U.S. PPI (Wednesday):
- Expected at 0.4% M/M
Investors remain highly focused on whether higher energy prices and geopolitical disruptions are feeding into broader inflation pressures. March CPI already showed inflation accelerating to its highest annual pace since May 2024, driven largely by surging gasoline prices.
If inflation data surprises to the upside again, markets may further reduce expectations for rate cuts, potentially adding additional pressure on gold in the near term.
Technical Structure Signals Caution
From a technical perspective, silver’s broader uptrend has not been invalidated. The break below $70 on Thursday was significant, but the decline was ultimately contained by key moving averages. Support emerged at the stronger buying interest above the $61 support zone and the 100 SMA (red) on the daily chart helped as well. We saw a rebound above $80 by Thursday last week.
Silver Chart Daily – Returning to the 100 SMA
But the 100 daily SMA (green) acted as resistance at the top after the rebound and sellers returned. However , the trend still remains upward, but buyers will have to push the price above the 100 SMA at around $80 which is a key resistance now, with higher levels sitting near $80, $100 and that is followed by the prior highs around $117–$121. On the downside, initial support is defined by the recent lows near $60, $60 and then $53.
Industrial Demand Adds Complexity
Unlike gold, silver is heavily tied to industrial activity, making it more sensitive to broader economic growth trends.
Demand from sectors such as:
- Electronics
- Solar energy
- Electric vehicles
- Industrial manufacturing
continues to play a major role in determining silver’s long-term direction.
This creates a more complicated outlook. While geopolitical uncertainty and safe-haven demand can support prices, slowing global growth or weaker manufacturing activity can quickly offset those gains.
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