Silver Rallies Above $90 on Yields Drop, AI Fears

Key Moments

AI Valuation Concerns and Risk-Off Mood Lift Silver

Silver (XAG/USD) is advancing 2.4% to around $90.60 during the European trading session on Friday, as the metal benefits from renewed demand for defensive assets. The move higher comes amid intensifying worries over the valuations of Artificial Intelligence (AI) equities, which have prompted investors to seek safety in precious metals.

On Thursday, the S&P 500 dropped to near 6,900, with futures extending losses as the session progressed. The broader equity pressure followed a decline of more than 5% in shares of Nvidia, described as the world’s largest producer of AI and sophisticated chips. This slide occurred despite what were characterized as stellar first quarter 2026 results, as market participants focused instead on the durability of AI-related capital expenditure and the risk of overcapacity.

Falling Treasury Yields Support Non-Yielding Assets

Alongside equity market stress, a pullback in United States Treasury yields has further burnished silver’s appeal. Yields on 10-year US government bonds have retreated to near 4%, a level noted as the lowest in more than a year. Declining returns on interest-bearing assets tend to improve the relative attractiveness of non-yielding instruments such as silver.

Geopolitics: US-Iran Nuclear Talks Show Progress

On the geopolitical front, discussions between the United States and Iran over nuclear issues held in Geneva on Thursday ended on an encouraging tone. Oman’s Foreign Minister, Badr al-Busaidi, said in early trade that talks between both nations on nuclear issues have made “significant progress,” and they will resume next week in Vienna. Generally, signs that geopolitical tensions are easing can reduce the need for safe-haven assets, although silver is currently drawing stronger support from financial-market factors.

Later in Friday’s session, market attention will turn to the United States Producer Price Index (PPI) for January, scheduled for release at 13:30 GMT.

Silver Technical Outlook: Bias Turns Mildly Constructive

XAG/USD is trading above $90 at the time of writing, with the short-term technical backdrop leaning modestly bullish. The price is holding above the 20-day Exponential Moving Average (EMA), located near $85, which has underpinned the recent recovery from the mid-$70s region.

The pattern of higher lows, starting from $73.64 and extending into the current consolidation, favors a recovery scenario rather than an immediate resumption of the sharp prior decline from levels above $110. The 14-day Relative Strength Index (RSI) remains confined within the 40.00-60.00 band, indicating a broadly sideways momentum profile.

On the downside, first support is seen at the 20-day EMA near $85.00. A decisive move below that region would expose the $80.00 psychological level, followed by the February 20 low around $77.50 as a more substantial area of potential demand.

On the upside, nearby resistance is identified around the recent plateau near $92.50. A daily close above that zone would open the way toward $96.00, and subsequently toward the psychologically important $100.00 level.

(The technical analysis of this story was written with the help of an AI tool.)

Silver as an Investment: Key Characteristics

Silver is a widely traded precious metal that has long served as both a store of value and a medium of exchange. Although it generally attracts less attention than gold, market participants may allocate to silver to diversify portfolios, for its intrinsic value, or as a potential hedge in periods of elevated inflation. Investors can obtain exposure through physical holdings, such as coins or bars, or via Exchange Traded Funds that track silver prices on global markets.

Drivers of Silver Prices

Silver prices can be influenced by a broad set of catalysts. Episodes of geopolitical stress or concerns about a pronounced economic downturn can lift silver due to its status as a safe-haven asset, though typically less strongly than gold. As a yieldless metal, silver tends to be supported when interest rates fall. Its performance is also closely tied to movements in the US Dollar, since silver is quoted in dollars as XAG/USD; a firm dollar can restrain prices, while a weaker dollar often provides a tailwind.

Other determinants include investment demand, mining output – with silver described as significantly more abundant than gold – and recycling activity, all of which can influence the balance between supply and demand.

Industrial Demand and the Gold Link

Industrial use is another important pillar of silver’s pricing. The metal plays a role in sectors such as electronics and solar energy, benefiting from what is described as one of the highest levels of electrical conductivity among metals, exceeding that of copper and gold. An upswing in industrial demand can push prices higher, while a slowdown can exert downward pressure. Economic developments in the United States, China, and India can be particularly relevant, given industrial usage in the US and China, and consumer demand for jewelry in India.

Silver also tends to trade directionally with gold, as both are viewed as safe-haven assets. The Gold/Silver ratio – which expresses how many ounces of silver are required to match the value of one ounce of gold – is often monitored as a gauge of relative value between the two metals. Some investors regard a high ratio as a sign that silver may be undervalued or that gold may be overvalued, whereas a low ratio can be interpreted as indicating the opposite.