Silver prices weaken toward $64.50 amid a hawkish Federal Reserve outlook.

Silver came under pressure after Fed Chair Kevin Warsh struck a surprisingly hawkish tone, with updated projections pointing to possible future rate hikes.

However, the white metal could regain momentum as easing inflation concerns tied to advancing US-Iran peace talks improve overall market sentiment. US Vice President JD Vance said negotiations had made “great progress,” despite lingering tensions.

Silver prices fell more than 1% during Tuesday’s Asian session, slipping to around $64.50 per troy ounce after posting modest gains a day earlier, as markets reacted to the Federal Reserve’s hawkish policy outlook.

Although the Fed kept interest rates unchanged at 3.50%–3.75% last week, updated projections and comments from new Fed Chair Kevin Warsh signaled a more aggressive stance than investors expected. Markets are now fully pricing in a 25-basis-point rate hike in September, with some traders even anticipating a small chance of tightening as early as next month.

Still, losses in Silver may remain limited as progress in US-Iran peace negotiations eases inflation concerns. US Vice President JD Vance said talks had made “great progress” despite lingering tensions, while Iranian Foreign Minister Abbas Araghchi also reported significant advances in the Swiss negotiations. Iran’s agreement to allow inspectors from the International Atomic Energy Agency back into the country further boosted optimism.

Precious metals, including Silver, have remained under pressure since Middle East tensions escalated in late February, as fears of disrupted oil flows through the Strait of Hormuz pushed crude prices higher and fueled expectations of prolonged elevated interest rates. However, sentiment improved after Washington granted Tehran a 60-day license to resume international oil sales, raising expectations of stronger global crude supply and easing inflationary pressures that had weighed on safe-haven assets.