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Silver falls toward $32.00 amid potential Russia-Ukraine ceasefire
Tuesday, 20 May 2025 11:47 WIB | SILVER |SILVER

Silver price continues its decline for the third consecutive session, trading near $32.20 per troy ounce during Tuesday's Asian session. The metal's weakness comes as optimism over a potential ceasefire between Russia and Ukraine reduces demand for safe-haven assets.

Reuters reported that US President Donald Trump stated on Monday that following a call with Russian President Vladimir Putin, Ukraine and Russia are set to begin immediate ceasefire negotiations, potentially without US involvement. This development has pressured precious metals, including Silver, which typically benefit from geopolitical uncertainty.

Despite the downtrend, Silver's losses on Monday were somewhat cushioned after Moody's downgraded the US sovereign credit rating from "Aaa" to "Aa1" last Friday, citing rising debt levels and interest burdens significantly higher than those of similarly rated peers. This move follows similar downgrades by Fitch in 2023 and S&P in 2011.

Recent US economic data—including softer Consumer Price Index (CPI) and Producer Price Index (PPI) readings—indicate cooling inflation, bolstering expectations for Federal Reserve rate cuts in 2025. Additionally, disappointing US Retail Sales figures have heightened concerns about sustained economic weakness, which could lend support to non-yielding assets like Silver.

According to the CME FedWatch Tool, markets now anticipate two Fed rate cuts this year, likely beginning in September. Investors will closely monitor upcoming speeches from Federal Reserve (Fed) officials for further insight into the central bank's policy direction and the broader economic outlook.

Source: Fxstreet

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