Silver rises above $60 as weaker US dollar boosts demand

Silver prices advanced during European trading on Friday as continued weakness in the US dollar and easing oil prices supported demand for the precious metal.

Meanwhile, gold prices edged lower and remained on track for a weekly decline as escalating tensions between the United States and Iran reinforced expectations that the Federal Reserve could maintain a hawkish monetary policy stance.

Silver gains as the US dollar remains under pressure

Silver (XAG/USD) traded 0.4% higher at around $60.22 during the European session.

The white metal benefited as the US dollar remained under pressure amid hopes that renewed tensions between the United States and Iran would not persist for an extended period.

At the time of writing, the US Dollar Index (DXY), which measures the Greenback against a basket of six major currencies, traded 0.16% lower near 100.7.

During the session, the index extended its decline to around 100.60, marking a three-week low.

A weaker US dollar generally improves the appeal of silver for investors by making the metal relatively more attractive.

US-Iran developments remain in focus

Market sentiment was influenced by developments surrounding US-Iran relations.

Earlier in the day, a US official confirmed that technical talks with Iran were continuing despite US President Donald Trump stating that the memorandum of understanding (MoU) with Tehran was over.

Late on Wednesday, President Trump said he had spoken with Iran and added that the country "wants the deal badly." However, he also said he did not believe Iran would honor any agreement.

The mixed signals surrounding diplomatic discussions contributed to investor attention on safe-haven assets while also weighing on the US dollar.

Silver also found support from a sharp pullback in crude oil prices following strong gains earlier in the week.

WTI crude oil remained close to Thursday's losses, trading near $72.00.

The correction in oil prices provided additional support for silver during Friday's session.

Looking ahead, investors are expected to closely monitor the release of the US Consumer Price Index (CPI) data for June, scheduled for next week, for further clues on the inflation outlook and the Federal Reserve's monetary policy path.

Gold slips and heads for a weekly loss

Gold prices moved slightly lower on Friday and were on course to post a weekly decline as rising tensions between the United States and Iran increased inflation concerns and strengthened expectations that the Federal Reserve could keep interest rates elevated.

Spot gold fell 0.1% to $4,115.79 per ounce by 0601 GMT.

The precious metal was on track to register a weekly loss of 1.4%.

Meanwhile, US gold futures for August delivery declined 0.4% to $4,124.90 per ounce.

Investors continued to assess geopolitical developments alongside expectations for US monetary policy, with inflation concerns remaining a key factor influencing sentiment in precious metals markets.