Silver shed 1.6% on Thursday, dropping to the $82 area during European hours as the US Dollar staged a notable recovery. The move came after two key data releases out of the United States reminded markets that the economy still has some fight left in it.

ADP's private payrolls report showed 63,000 jobs added in February, beating analyst estimates and cooling some of the recent anxiety around labor market softness. Adding to that, the ISM Services PMI climbed to 56.1 last month from 53.8 previously a reading that signals broad expansion across the services sector and puts a near-term Fed rate cut further out of reach.

The Dollar Index clawed back to around 99.10, up roughly 0.35% on the session. For silver, a stronger greenback creates a familiar headwind dollar-denominated assets simply become pricier for buyers holding other currencies, which tends to drag demand.

Geopolitical noise provided some floor for prices, with ongoing military escalation involving the US, Israel, and Iran keeping safe-haven interest alive. That tension has been supporting precious metals broadly, though it wasn't enough to offset the dollar's renewed strength on Thursday.

From a macro standpoint, the upbeat data chips away at the case for dovish Fed action in the near term. With rate cut expectations pulling back, yield-bearing alternatives look more attractive against non-yielding silver a dynamic that could keep pressure on XAG/USD in the sessions ahead unless risk sentiment deteriorates sharply.

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