As the silver price (XAG/USD) holds steady around $29.50, all eyes are on the upcoming release of the US Personal Consumption Expenditure (PCE) inflation data for July. The market is anticipating a rise in the annual core PCE inflation to 2.7%, which could impact the Federal Reserve’s decision on interest rate cuts starting from September.
The Fed is expected to reduce interest rates in the coming months, with a 33% probability of a 50-basis points cut in September according to the CME FedWatch tool. This anticipation is reflected in the 10-year US Treasury yields, which have edged lower to 3.86%.
On the technical side, silver price continues to trade near $29.50, finding support at the 20-day Exponential Moving Average. The major resistance level stands at $30.20, with the 14-day Relative Strength Index indicating market indecisiveness.
Silver FAQs
Silver is a precious metal highly sought after by investors for its value and potential as a hedge during high-inflation periods. It can be traded through various vehicles such as Exchange Traded Funds or purchased in physical form like coins or bars.
Factors influencing silver price movements include geopolitical instability, interest rates, US Dollar behavior, investment demand, and industrial usage. The metal is widely used in sectors like electronics and solar energy, with demand dynamics in economies like the US, China, and India also impacting prices.
Overall, understanding the factors affecting silver prices and keeping an eye on key economic data like US PCE inflation can help investors make informed decisions and navigate the volatility of the market.