Key Takeaways:
COMEX silver rose 2.26 percent to $66.27 an ounce as of 21:00 ET on June 21, recovering from a 5.20 percent weekly decline as fading optimism over US-Iran peace negotiations revived safe-haven demand for precious metals.
"The formal signing of the Switzerland Peace Pact initially stripped safe-haven premiums from the precious metals complex, but the resulting decline in crude oil prices calmed inflation fears and supported a broader macro stabilization," according to a market analysis from FXStreet. "Lower energy prices paved the way for a more stable economic cycle."
The rebound comes after Qatar and Pakistan said in a joint statement that "encouraging progress" was made in a first round of high-level peace negotiations in Switzerland, though subsequent reports indicated the talks faced headwinds. The Islamabad Memorandum of Understanding had initiated a 60-day ceasefire between the US and Iran and reopened the Strait of Hormuz, but uncertainty over the permanence of the agreement has kept geopolitical risk premiums elevated. Gold also advanced, climbing as much as 1.6 percent to top $4,220 an ounce, according to Bloomberg data.
Silver's physical market fundamentals remain a key support. The metal is navigating its sixth consecutive year of structural supply deficit, with a projected shortfall of 46.3 million ounces adding to a cumulative drawdown of more than 760 million ounces since 2020, according to industry data. This systemic supply constraint continues to deplete above-ground stockpiles, making the physical market highly sensitive to any pickup in buying interest.
Supply Deficit Deepens as Industrial Demand Shifts
The structural deficit has been driven by sustained demand from high-growth industrial sectors including solar energy, electronics, and electric vehicles. However, solar photovoltaic manufacturers are actively reducing the silver intensity of solar cells, with silver consumption from that sector projected to fall 19 percent to 20 percent year-over-year, according to industry estimates. Physical premiums in China and other key Asian wholesale markets have also declined, removing an essential spot-market price floor.
On the macro front, the hawkish policy debut of newly appointed Federal Reserve Chair Kevin Warsh had propelled the US dollar and real Treasury yields to fresh yearly highs, applying downward pressure on non-yielding assets. The dollar's rally has since begun to stall, allowing silver to regain its footing.
Technical Levels in Focus
Silver's recovery follows a sharp correction that pushed the metal below its 200-day moving average for the first time since mid-2025. It now trades below its 20-day, 50-day, and 100-day moving averages, according to technical data. The relative strength index stands at 39.7, indicating neutral territory after the oversold bounce, while the MACD remains in sell territory at negative 0.48.
The metal's high-beta characteristic within the precious metals complex means any further deterioration in US-Iran diplomatic progress could accelerate safe-haven inflows, while a confirmed peace deal would likely strip the geopolitical premium and expose silver to renewed selling. The next catalyst is the continuation of implementation talks in Switzerland later this week.
This article is for informational purposes only and does not constitute investment advice.
