Silver prices trading near two weeks low due to strength in the dollar index. Fresh lockdown measures in Germany and France have also weighed on industrial metal demand and likely to keep silver prices under pressure.
Concern about the third wave of Covid infections in Europe is likely to reduce industrial metals demand. German Chancellor Merkel on Tuesday said that Germany is "in a very, very serious situation" with Covid "case numbers rising exponentially and intensive-care beds filling up again." She said Germany will go into a hard lockdown during the Easter holiday for five days starting April 1, when all stores will be closed except for food stores.
Silver prices were also under pressure after hawkish comments from Dallas Fed President Kaplan when he said that the rise in Treasury yields over the past month is a healthy sign and he estimates the first Fed rate hike will be in 2022, which is more hawkish than the consensus Fed dot plot that signals no interest rate hike through 2023.
Also, Fed Chair Powell reduced inflation concerns when he said that "inflation will move up over the course of this year," due to pent-up demand and supply-chain bottlenecks, but "our best view is that the effect on inflation will be neither particularly large nor persistent." These comments are negative for precious metals which are used as a hedge against inflation.
Silver prices are likely to trade negatively while below key resistance level near 50 days EMA at $26.241 while it may find a strong support base around 200 days EMA at $24.731