Silver prices (XAG/USD) extended their gains for a second consecutive session on Tuesday, trading near $31.70 per troy ounce during Asian market hours. The precious metal’s upward momentum is driven by heightened risk aversion as investors flock to safe-haven assets amid escalating trade tensions and global economic uncertainty.
Trade Disputes Drive Market Sentiment
Investor anxiety surged after the White House confirmed that U.S. President Donald Trump signed an order to increase tariffs on Chinese imports to 20%, effective Tuesday. However, proposed tariffs on Mexico and Canada remain pending. Trump reiterated that reciprocal tariffs would be implemented on April 2 for countries that levy duties on U.S. goods.
In retaliation, Canada’s Prime Minister’s Office announced that 25% tariffs on U.S. imports—valued at C$30 billion—would take effect if U.S. tariffs proceed. Meanwhile, China’s Commerce Ministry vowed to take “necessary countermeasures” to protect its economic interests, deepening concerns about a global trade war.
Economic Data Provides Mixed Signals
U.S. economic data offered conflicting signals, further clouding the market outlook. The ISM Manufacturing PMI slipped to 50.3 in February, falling short of the expected 50.5 and down from 50.9 in January, indicating slower manufacturing growth. However, the S&P Global final Manufacturing PMI surpassed forecasts at 52.7, reflecting an improvement from the preliminary estimate.
Focus Shifts to U.S. Jobs Data
Market participants are now closely watching the upcoming ADP employment report on Wednesday and the Nonfarm Payrolls (NFP) report on Friday. The labor market data will play a key role in shaping expectations for the Federal Reserve’s future interest rate decisions, which could significantly impact silver prices.
Technical Outlook
Silver bulls remain in control, with the metal holding firm near $31.70. A sustained move above $32.00 could open the door for further gains toward the $32.50 resistance zone. On the downside, immediate support lies at $31.30, followed by the psychological level of $31.00.
With trade tensions rising and economic uncertainty persisting, silver is likely to retain its safe-haven appeal in the near term.
