Silver (XAG/USD) prices extended their gains for the third straight session, trading around $32.90 a troy ounce during Asian trading hours on Monday (5/12). The precious metal was supported by news that Canadian miner Pan American Silver will acquire MAG Silver Corp in a deal that values ​​the company at around $2.1 billion, according to Reuters.

The acquisition gives Pan American Silver access to MAG's 44% stake in Mexico's high-grade Juanicipio Silver mine, which is operated by Fresnillo, which owns the remaining 56%. The deal, which was unanimously approved by both companies' boards, is expected to close in the second half of 2025.

Meanwhile, geopolitical tensions continue to provide support for Silver. India warned Pakistan of potential retaliation for recent ceasefire violations, a claim denied by the Pakistani military. Separately, Ukrainian President Volodymyr Zelenskyy expressed hope for a temporary ceasefire with Russia starting Monday, May 12, but Moscow rejected the proposal, instead calling for direct talks without preconditions.

However, silver's gains may be limited by easing safe-haven demand amid growing optimism about US-China trade relations. Over the weekend, the two countries concluded productive discussions, with Beijing preparing to launch formal negotiations and Washington citing progress toward a deal.

Further weighing on silver, the Federal Reserve last week flagged risks to inflation and the labor market, with Chairman Jerome Powell ruling out preemptive interest rate cuts in response to tariff-related economic concerns. (Newsmaker23)

Source: FXstreet