Silver opened lower for the third straight day this week as military exchanges between the United States and Iran rattled commodity markets. September silver futures opened at $58.88 per ounce on Thursday, July 9, up 0.6% from Wednesday's close of $58.54, but the metal hit a new weekly low in early trading before recovering slightly to $58.88 as of 8:17 a.m. ET, according to Yahoo Finance.
The week's pattern has been clear. Silver's opening price has fallen each day since Monday, tracking gold's movements as geopolitical tension between the US and Iran escalated. The Financial Times reported that the United States struck Iranian railway bridges on a route to the city where Supreme Leader Khamenei was buried, a development that has all but eliminated a fragile ceasefire that had been in place between the two countries.
The renewed hostilities pushed oil prices higher. The concern among investors is that if the strikes grind traffic to a halt in the Strait of Hormuz for an extended period, inflation could reignite just as Federal Reserve policymakers gather for their next rate-setting meeting at the end of July. Elevated interest rates tend to put downward pressure on silver prices, which do not offer a yield and become less attractive when borrowing costs are high.
The longer-term picture for silver is more complicated. One month ago, silver was trading 13.7% higher than current levels. One year ago, the price was 61.8% lower than it is today. At its peak year-over-year growth on May 14, 2026, silver had risen 173.3% compared to the same date the prior year. That peak date coincides with when several other financial assets, including Nvidia stock, also hit recent highs before pulling back sharply.
Silver has historically followed gold, which is itself sensitive to shifts in real interest rates, the strength of the US dollar, and geopolitical risk. All three of those factors are in motion right now. The combination of a military confrontation involving Iran, one of the world's major oil producers, and a Federal Reserve meeting looming at the end of the month has created an unusually active environment for precious metals traders.
The Strait of Hormuz connects the Persian Gulf to the Gulf of Oman and is one of the most heavily trafficked shipping lanes in the world for crude oil. Any disruption to tanker traffic through the strait would affect global oil supply chains. Higher oil prices feed into transportation and manufacturing costs broadly, which can lift overall inflation readings. That scenario would give the Fed less room to cut interest rates, keeping pressure on assets like silver that compete with interest-bearing investments.
Whether the current dip proves temporary depends largely on how the military situation develops. The ceasefire that had been in place between the US and Iran was already described as fragile before this week's strikes. The fresh round of attacks has left traders uncertain about how quickly, or whether, a new agreement could be reached.
The Fed's next meeting is scheduled for the end of July. Any data or events that shift expectations about that meeting, either toward a rate cut or toward holding rates steady, will likely move silver prices in the days ahead.
