Silver Price Forecast: XAG/USD trades lower near $74.60 as oil prices extend recovery

Silver price (XAG/USD) is down 0.6% to near $74.60 during the European trading session on Wednesday. The precious metal faces selling pressure as oil prices gain for the third straight trading day amid renewed tensions between the United States (US) and Iran.

At press time, the WTI Oil price is up 1.4% higher to near $93.00 the highest level seen in over a week.

US-Iran tensions have renewed due to the exchange of attacks between them on late Tuesday. The US Central Command (CENTCOM) said on Tuesday that it had intercepted and defeated a series of Iranian missile and drone attacks targeting regional neighbors, including Kuwait and Bahrain, while also carrying out self-defense strikes on Iran’s Qeshm Island in the Strait of Hormuz.

Oil prices and precious metals have demonstrated a negative relationship since the onset of the Middle East war, as rising energy prices boosted inflation globally and forced traders to price out the likelihood of interest rate cuts by the Federal Reserve (Fed) for the year.

Meanwhile, upbeat US JOLTS Job Openings data for April has come in stronger-than-projected. The data showed that US employers posted 7.618 million fresh jobs, significantly higher than 6.88 million estimates.

Going forward, investors will focus on the US Nonfarm Payrolls (NFP) data for May, which will be released on Friday.