Silver prices slipped to a two-week low in the European market on Monday, deepening losses for a third consecutive session, under pressure from rising dollar and oil prices in global markets, amid escalating geopolitical tensions between the United States and Iran.

As inflationary pressures continue to build on Federal Reserve policymakers, expectations for at least one US interest rate hike this year have increased, with investors awaiting further economic data and Fed commentary.

Price Overview

• Silver prices today: Silver prices fell 2.75% to $73.87, the lowest level since May 6, from the opening level at $75.96, while recording an intraday high of $76.92.

• At Friday’s settlement, silver prices lost 9%, marking the second consecutive daily loss and the largest one-day decline since February 5, pressured by higher dollar and oil prices.

• Silver prices declined 5.5% last week, marking the third weekly loss within a month, due to rising inflationary pressures in the United States and higher US Treasury yields.

US Dollar

The dollar index rose 0.15% on Monday, extending gains for a sixth consecutive session and recording a six-week high, reflecting continued broad strength in the US currency against a basket of major and secondary currencies.

The dollar received additional support from US Treasury yields climbing to their highest levels in a year, as investors bet that the Federal Reserve will raise interest rates at least once this year.

Investors also continue buying the US dollar as a safe haven, as renewed tensions between the United States and Iran pushed oil prices higher and reduced risk appetite amid a global bond selloff.

Barclays analysts said in a note: “Risk and bond market conditions appear to be deteriorating, while the environment remains supportive for further dollar gains this week.”

They added that signs pointing to a prolonged closure of the Strait of Hormuz are creating additional upward pressure, noting that the dollar tends to rise between 0.5% and 1% for every 10% increase in oil prices.

Global Oil Prices

Global oil prices rose more than 2% on Monday, extending gains for a third consecutive day and recording the highest levels in two weeks, amid fears of renewed military confrontations between the United States and Iran and the continued closure of the Strait of Hormuz to international oil tankers.

Latest Developments in the Iran War

• US President Donald Trump issued a sharp warning to Iran, stressing that “time is running out very quickly to reach a peace agreement, or there will be nothing left.”

• Trump is preparing to hold a decisive meeting in the White House Situation Room with national security leaders to discuss plans for resuming military strikes on Iranian energy facilities and infrastructure.

• Trump held a phone call lasting more than half an hour with Israeli Prime Minister Benjamin Netanyahu to discuss options for returning to full-scale military operations.

• The UAE announced it is investigating the source of the drone attack, while Saudi Arabia intercepted three drones in Iraqi airspace.

• An Iranian official warned of “surprise scenarios” if the United States resumes military strikes against Tehran.

US Interest Rates

• Data released last week in the United States showed consumer prices in April rose at the fastest pace in three years, while producer prices recorded their strongest increase in four years, highlighting renewed inflationary pressure on Federal Reserve policymakers.

• According to the CME FedWatch tool, markets are currently pricing in a 45% probability that the Federal Reserve will raise interest rates in December, up from just above 16% at the beginning of May.

• Last week, pricing for the probability of keeping US interest rates unchanged at the June meeting rose from 93% to 99%, while pricing for a 25 basis point rate cut fell from 7% to 1%.

• To reassess those expectations, investors are closely monitoring upcoming US economic data, in addition to the minutes of the Federal Reserve’s latest meeting scheduled for release on Wednesday.

The US dollar weakened against a basket of major currencies on Monday, though it remained near last week’s highs, as renewed Middle East tensions pushed global bond yields higher, while continued weakness in the Japanese yen kept traders alert for possible intervention by Japanese authorities.

The euro rose 0.1% to $1.1635, while the British pound gained 0.2% to $1.3351.

The dollar index — which measures the US currency against a basket of six major currencies — edged slightly lower to 99.12 points, after recording its strongest weekly performance in three months last week.

Barclays analysts wrote in a note: “Risk and bond market conditions appear to be deteriorating, while the environment is becoming increasingly supportive for an extension of the dollar’s rally this week.”

They added that signs the Strait of Hormuz could remain closed for longer are creating additional upward pressure, noting that the dollar tends to rise between 0.5% and 1% for every 10% increase in oil prices.

Oil prices climbed on Monday, with Brent crude rising more than 1% to trade above $110 per barrel, after a nuclear energy facility in the UAE came under attack and efforts to end the US-Israeli war against Iran stalled.

Risk appetite was also hurt by a worsening global bond selloff, as higher energy prices fueled inflation concerns and strengthened expectations for further interest rate hikes by major central banks.

The yield on the US 10-year Treasury note climbed to 4.6310%, while the two-year Treasury yield reached 4.1020%, with both hovering near their highest levels since February 2025.

Michael Pfister, FX strategist at Commerzbank, said shifting interest rate expectations and the subsequent rise in bond yields were the key drivers behind the dollar’s relative resilience.

He added:

“Although market expectations toward the Federal Reserve shifted toward a more hawkish stance early on, investors had initially been reluctant to price in rate hikes. That changed last week, as Fed expectations experienced the biggest shift among G10 currencies.”

Minutes from the Federal Reserve’s latest meeting and US PMI data due this week are expected to help clarify how concerned policymakers are about persistent inflation and whether economic activity momentum remains intact, according to Christopher Wong, FX strategist at OCBC Bank.

Markets are now pricing in more than a 50% probability that the Federal Reserve will raise interest rates by December, according to the CME FedWatch tool.

Investors are also monitoring the G7 finance ministers and central bank governors meeting in Paris on Monday and Tuesday, where discussions are expected to focus on ways to permanently end the war in Iran.

In Asia, the Japanese yen traded at 158.9 per dollar, near its weakest levels since April 29, keeping investors on alert for possible intervention by Japanese authorities.

Tokyo intervened several times in the currency market in late April and early May, helping the yen rebound roughly 3.5% in the following days, although the currency has already surrendered around 7% of those gains.

Meanwhile, China’s offshore yuan weakened to 6.808 per dollar. Meetings between US President Donald Trump and Chinese President Xi Jinping last week produced no major breakthroughs, while data released on Monday showed Chinese economic growth lost momentum during April.

Gold prices declined in European trading on Monday, extending losses for a fifth consecutive session and hitting their lowest levels in nearly two months, pressured by escalating tensions between the United States and Iran, alongside rising US dollar and global oil prices.

With inflationary pressure increasing on Federal Reserve policymakers, expectations have grown for at least one US interest rate hike this year, as investors await further economic data and Federal Reserve commentary.

Price Overview

• Gold prices today: Gold prices fell 1.3% to $4,480.43, the lowest level since March 30, from an opening level of $4,540.58, while recording an intraday high of $4,559.95.

• At Friday’s settlement, gold prices lost 2.4%, marking a fourth consecutive daily decline, after US 10-year Treasury yields climbed to their highest levels in a year.

• Gold prices lost around 3.7% last week, recording their third weekly decline in a month and the biggest weekly loss since March, due to global inflation concerns and rising expectations for higher interest rates.

US Dollar

The dollar index rose 0.15% on Monday, extending gains for a sixth consecutive session and reaching its highest level in six weeks, reflecting continued broad strength in the US currency against a basket of major and secondary currencies.

The dollar received additional support from rising US Treasury yields, which climbed to their highest levels in a year, as investors bet that the Federal Reserve will raise interest rates at least once this year.

Investors also continue buying the US dollar as a safe haven, as renewed tensions between the United States and Iran pushed oil prices higher and weakened risk appetite amid ongoing bond market selling.

Analysts at Barclays said in a note: “Risk and bond market conditions appear to be deteriorating, and the environment remains supportive for further dollar gains this week.”

They added that signs the Strait of Hormuz could remain closed for a longer period are creating upward pressure, noting that the dollar tends to rise between 0.5% and 1% for every 10% increase in oil prices.

Global oil prices

Global oil prices rose more than 2% on Monday, extending gains for a third consecutive session and reaching their highest levels in two weeks, amid fears of renewed military confrontation between the United States and Iran and the continued closure of the Strait of Hormuz to international oil tankers.

Latest developments in the Iran conflict

• US President Donald Trump issued a stern warning to Iran, saying that “time is running out very quickly to reach a peace agreement, or there will be nothing left.”

• Trump is preparing to hold a key meeting in the White House Situation Room with national security leaders to discuss plans for resuming military strikes against Iranian energy facilities and infrastructure.

• Trump held a phone call lasting more than half an hour with Israeli Prime Minister Benjamin Netanyahu to discuss options for returning to full-scale military action.

• The UAE announced it is investigating the source of the drone attack, while Saudi Arabia intercepted three drones in Iraqi airspace.

• An Iranian official warned of “surprise scenarios” if the United States resumes military strikes against Tehran.

US interest rates

• Data released last week in the United States showed consumer prices in April rose at the fastest pace in three years, while producer prices increased at the strongest pace in four years, highlighting renewed inflationary pressure on Federal Reserve policymakers.

• According to the CME FedWatch tool, markets are currently pricing in a 45% probability of a Federal Reserve rate hike in December, compared with just over 16% at the beginning of May.

• Markets also increased pricing for the Federal Reserve keeping interest rates unchanged at its June meeting from 93% to 99% last week, while pricing for a 25 basis point rate cut fell from 7% to 1%.

• Investors are closely monitoring further US economic data, in addition to the minutes of the Federal Reserve’s latest meeting scheduled for release on Wednesday, in order to reassess those expectations.

Gold outlook

Edward Meir, analyst at Marex, said: “Precious metals are facing heavy selling pressure for several reasons. The dollar is extremely strong, and we are seeing rising bond yields not only in the United States, but globally as well.”

Meir added: “China has offered little meaningful help in resolving the Middle East conflict, so we continue to see higher crude oil prices, which reinforce inflation expectations, and this has had a significantly negative impact on metal prices.”

SPDR Fund

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, declined by around 2.57 metric tons on Friday, bringing total holdings down to 1,037.42 metric tons, retreating from 1,039.99 metric tons, which had been the highest level since April 28.

The euro weakened in European trading on Monday against a basket of global currencies, extending its losses for a sixth consecutive session against the US dollar and hitting its lowest level in six weeks, as investors continued buying the US currency as a preferred safe-haven asset amid escalating geopolitical tensions in the Middle East, especially following Trump’s latest warnings to Iran.

Oil prices continue to rise in global markets, increasing inflationary pressure on European Central Bank policymakers and strengthening expectations for a European interest rate hike in June.

Price Overview

• Euro exchange rate today: The euro fell 0.15% against the dollar to $1.1608, the lowest level since April 8, from today’s opening level of $1.1625, while recording an intraday high of $1.1626.

• The euro ended Friday down 0.4% against the dollar, marking its fifth consecutive daily loss, following another sharp rise in US Treasury yields.

• The euro lost 1.35% against the dollar last week, recording its first weekly decline in three weeks and its biggest weekly loss since March, due to fears of a renewed Iran conflict and rising global oil prices.

US Dollar

The dollar index rose 0.15% on Monday, extending gains for a sixth consecutive session and reaching its highest level in six weeks, reflecting continued broad strength in the US currency against a basket of global currencies.

The dollar received additional support from rising US Treasury yields, which climbed to their highest levels in a year, as investors bet that the Federal Reserve will raise interest rates at least once this year.

Data released last week in the United States showed consumer prices in April rose at the fastest pace in three years, while producer prices increased at the strongest pace in four years, highlighting renewed inflationary pressure on Federal Reserve policymakers.

According to the CME FedWatch tool, markets are currently pricing in a 45% probability of a Federal Reserve rate hike in December, compared with just over 16% at the beginning of May.

Investors also continue buying the US dollar as a safe haven, as renewed Middle East tensions pushed oil prices higher and weakened risk appetite amid ongoing bond market selling.

Opinions and Analysis

• Analysts at Barclays said in a note: “Risk and bond market conditions appear to be deteriorating, and the environment remains supportive for further dollar gains this week.”

• They added that indications the Strait of Hormuz could remain closed for a longer period are creating upward pressure, noting that the dollar tends to rise between 0.5% and 1% for every 10% increase in oil prices.

• Christopher Wong, strategist at OCBC Bank, said: “In the near term, the US dollar may remain better supported on dips if yields stay elevated and markets continue expecting a more hawkish reaction from the Federal Reserve.”

Global oil prices

Global oil prices rose more than 2% on Monday, extending gains for a third consecutive session and reaching their highest levels in two weeks, amid fears of renewed military confrontation between the United States and Iran and the continued closure of the Strait of Hormuz to international oil tankers.

Latest developments in the Iran conflict

• US President Donald Trump issued a stern warning to Iran, saying that “time is running out very quickly to reach a peace agreement, or there will be nothing left.”

• Trump is preparing to hold a key meeting in the White House Situation Room with national security leaders to discuss plans for resuming military strikes against Iranian energy facilities and infrastructure.

• Trump held a phone call lasting more than half an hour with Israeli Prime Minister Benjamin Netanyahu to discuss options for returning to full-scale military action.

• The UAE announced it is investigating the source of the drone attack, while Saudi Arabia intercepted three drones in Iraqi airspace.

• An Iranian official warned of “surprise scenarios” if the United States resumes military strikes against Tehran.

European interest rates

• Amid rising global oil prices, money markets continue to price in more than a 50% probability that the European Central Bank will raise interest rates by 25 basis points in June.

• Investors are awaiting further economic data from the eurozone on inflation, unemployment, and wages in order to reassess those expectations.