Rising Oil Prices Hammer Silver, Fueling Expectations of US Fed Rate Hike

Silver has fallen by 23% this year and is trading well below its January all-time high of $121 per ounce, weighed down by rising oil prices tied to the Iran war.

The price of silver has been pushed lower by rising oil prices, which have strengthened the dollar and put pressure on the US Fed to hike interest rates. This has led to a 23% decline in silver prices so far this year, with June alone seeing a 22% drop.

The current price of silver is around $58 per ounce, up over 50% from last year but still below its all-time high. The US Fed's decision to maintain interest rates at 3.5%-3.75% has been influenced by the resurgence in inflation following the outbreak of the Iran war.

With expectations for a rate hike in September growing, investors should be cautious and limit their exposure to silver, considering a maximum investment of 10%. The bond yields are also a key indicator of market movements, with the current 10-year yield at around 4.65%.