Silver falls to 3-week low on rising dollar

Silver prices fell on Monday, and hit a 3-week low as the US dollar rose against most of its rivals, due to growing chances of the near tightening of the US monetary policy.

Silver prices fell 0.6% to the lowest level since August 27 at $23.59 an ounce, after opening at $23.74, and hit a high of $23.80.

Silver closed lower by 1.25% on Friday, the fourth loss in 5 days, as most dollar-denominated metal prices fell.

Silver prices lost about 4.0% last week, in the first weekly loss in the last three weeks, due to the strong performance of the US currency against a basket of currencies, in addition to concerns about the levels of actual demand in China, the largest consumer of metals in the world.

Silver prices lost 2.1% last week, the first loss in 3 weeks, due to strong US dollar and concerns about demand levels in China.

The dollar index rose 0.3% on Friday for another session, marking three-week highs at 92.88 against a basket of major rivals.

The gains come on the back of upbeat inflation data in the US, which might pave the way for a reduction in the bonds purchases program sooner than expected.

Loretta Meester, President of the Federal Reserve Bank of Cleveland said on Friday that she still wanted the US central bank to start reducing asset purchases this year.