Silver Price Forecast: XAG/USD steadies near $30.00 amid uncertainty over Trump's tariff

• Silver price receives support due to uncertainty over the tariff policy ahead of the Trump administration.
• The industrial demand for Silver strengthens due to a positive economic outlook in China, the world's largest consumer of metals.
• The upside of the dollar-denominated metal could be restrained due to the improved US Dollar.

Silver price (XAG/USD) extends its winning streak for the fifth consecutive day, trading around $30.10 per troy ounce during the Asian hours on Wednesday. Silver, a safe-haven asset, found some support amid uncertainty over the tariff policy ahead of Trump's inauguration. However, Trump dismissed a Washington Post report suggesting that his team was considering narrowing the scope of his tariff plan to target only specific critical imports.

Additionally, a positive economic outlook in China, the world's largest consumer of Silver, is strengthening demand for the metal. The People’s Bank of China (PBoC) is working with the State Planner to stimulate the country's economy. PBoC official Peng Lifeng announced that the central bank will support banks in expanding loans under the trade-in initiative.

However, the price of the dollar-denominated precious metal may struggle as an improved US Dollar (USD) makes it more expensive for buyers using foreign currencies, thereby dampening Silver demand. The US Dollar Index (DXY), which measures the US Dollar’s (USD) performance against six major currencies, holds its position above 108.50 at the time of writing. The Greenback strengthened as the 10-year yield on US Treasury bonds rose by over 1% in the previous session, currently standing at 4.68%.

This surge highlights the changing investor sentiment toward the Federal Reserve's (Fed) interest rate outlook following robust US economic data. The latest ISM services report suggested increased activity and rising prices in the United States (US), intensifying concerns about persistent inflation. This has further pressured Silver price, as higher interest rates tend to reduce demand for the non-yielding metal. Traders are now focusing on upcoming US jobs data, including the Nonfarm Payroll (NFP) report, as well as the latest FOMC Minutes, for further policy insights.

The US ISM Services PMI increased to 54.1 in November, up from 52.1, exceeding the market expectation of 53.3. The Prices Paid Index, which reflects inflation, rose significantly to 64.4 from 58.2, while the Employment Index dipped slightly to 51.4 from 51.5.