Silver prices concluded the trading session with an increase of 0.92%, reaching Rs 218,400. This uptick was bolstered by short covering and the persistent geopolitical tensions in the Middle East. Market sentiment continued to center on the U.S.-Iran conflict, as Iran indicated that negotiations with the United States might advance if they align with national interests. Concurrently, apprehensions lingered regarding potential shipping disruptions through the Strait of Hormuz, following reports of attacks on oil tankers. The uncertain geopolitical backdrop continued to bolster precious metals. On the monetary policy front, Federal Reserve officials upheld a hawkish stance.
Cleveland Fed President Beth Hammack, Dallas Fed President Lorie Logan, and Fed Vice Chair Philip Jefferson all indicated that additional interest rate hikes could be necessary if inflation continues to be persistent. Fed Chair Kevin Warsh reaffirmed his dedication to managing inflation effectively, though he did not offer specific policy direction. Markets currently assign approximately a 50% likelihood of a rate hike in September, while the expectations for a December rate increase have risen to 80% from 73% just a week prior, as indicated by CME FedWatch.
Meanwhile, June data indicated a decline in U.S. consumer and producer prices, attributed to reduced energy costs; however, there was an unexpected rise in import prices. ANZ anticipates that silver will maintain a strong correlation with gold in the short term, as its fundamental demand outlook is expected to progressively enhance over the medium to long term. London silver vault holdings rose by 1.7% month-on-month, reaching 28,082 tonnes at the conclusion of June 2026. This amount is valued at $53.1 billion, which is roughly equivalent to 936,052 silver bars. In contrast, India’s silver imports experienced a significant decline of 87% year-on-year in May, attributed to stricter import restrictions and elevated import duties.
Technically, the market experienced short covering, as open interest decreased by 1.79% to 12,878 contracts, coinciding with a rise in prices. Immediate support is observed at Rs 217,330, succeeded by Rs 216,265, whereas resistance is positioned at Rs 219,935. A sustained move above this level could open the way towards Rs 221,475, keeping the near-term outlook constructive.