• Silver falls as India has immediately curbed nearly all Silver imports.
• CME FedWatch tool suggests that markets see a 48% chance of a December rate hike, up from 14% last week.
• UBS strategists cut Silver investment demand forecasts to 300 million ounces, citing weaker industrial demand and higher supply.

Silver price (XAG/USD) extends its losses for the third successive day, trading around $74.20 per troy ounce during the Asian hours on Monday. India has immediately curbed nearly all Silver imports to reduce shipments and ease pressure on the Indian Rupee. The restriction is expected to tighten domestic supplies and potentially lift local market premiums. Lower demand from India could weigh on global prices.

The white metal falls because a Middle East energy shock is driving up broader inflation, leading to expectations of higher central bank interest rates. The US Federal Reserve (Fed) is shifting toward a more aggressive stance on inflation. Several Fed officials recently emphasized that controlling inflation is their top priority, even suggesting that further interest rate hikes could be necessary if price pressures persist. Financial markets have sharply increased the likelihood of a December rate hike to nearly 48%, up significantly from just 14% a week prior, according to the CME FedWatch tool.

The dollar-denominated metal also struggles due to a stronger US Dollar (USD), which could be attributed to increased risk aversion amid ongoing geopolitical conflicts. The United States (US) and Iran remain far from an agreement to end weeks of fighting and reopen the critical Strait of Hormuz shipping route.

US President Donald Trump escalated tensions by publicly warning Iran to make progress or face new consequences. Because the Strait remains effectively closed, global oil prices are continuing to climb, which places a heavy economic burden on countries that rely heavily on energy imports. Global investor anxiety is heightened further by warnings from Chinese leader Xi Jinping to President Trump that Taiwan could trigger direct clashes between their two economies.

UBS strategists hurt market sentiment by cutting their Silver investment demand forecast from over 400 million ounces to 300 million, blaming weaker industrial demand and higher mining supply. Consequently, they expect the global Silver deficit to shrink dramatically to 60–70 million ounces, down from the previous 300 million estimate.

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