Everbright Futures: Geopolitical tensions ease, silver prices surge

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The expectation that tensions between the U.S. and Iran will ease has become a main factor in the recent market sentiment rebound. This also indicates the current market’s sensitivity to geopolitical developments. However, the direction of U.S.-Iran negotiations and conflicts remains highly uncertain, which means that precious metal prices, including gold and silver, may still experience high volatility.

Regarding the Federal Reserve, CME’s FedWatch shows that the probability of the Fed maintaining interest rates in June is 84.5%, with a 14.8% chance of a rate hike. For July, the likelihood of keeping rates unchanged versus the current level is 82.7%, with a 16.3% chance of a rate increase.

Federal Reserve Governor Barr stated that, based on the current situation and available data, it may be appropriate for the Fed to keep interest rates stable for a period while assessing upcoming data, changes in the economic outlook, and the risk balance. This suggests that the rate-cutting logic that supported the rise in gold and silver earlier this year might have changed. After the rapid release of bearish sentiment, although silver’s rebound momentum remains relatively strong, investors should remain cautious of the possibility that the rebound may lack sustainability or that the upside potential could be limited. (Everbright Futures)

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