Silver Swoon: iShares SLV Tumbles 3.57% Amid Hawkish Rate Commentary
iShares Silver Trust (NYSE:SLV) shares have been trading lower on Wednesday due to physical silver prices retreating under pressure from a firming U.S. dollar and elevated bond yields.
The downturn across precious metals funds follows hawkish remarks delivered by Richmond Federal Reserve President Tom Barkin, who stated that 'the risks to inflation outweigh the risks to maximum employment' while cautioning regarding future policy actions.
Barkan's stance triggered an upward move in Treasury yields and bolstered the dollar against foreign currencies. Rising bond yields increase the opportunity cost of holding non-yielding precious metals like physical silver bullion.
The iShares Silver Trust is exposed to broader monetary policy tightening, as it serves both as a monetary asset and a key manufacturing input. Elevated corporate borrowing costs threaten to slow capital expenditure across various industries, softening physical demand forecasts for industrial silver.