XAG/USD depreciates toward $29.50 despite a dovish Fed
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Silver price pares its intraday gains despite a dovish sentiment surrounding the US Fed. Fed’s Powell indicated that the time for rate cuts has arrived, but did not provide the extent of the reductions. The grey metal received support from the safe-haven flows amid rising Middle-East tensions. Silver (XAG/USD) price edges lower to near $29.70 per troy ounce during the Asian session on Monday. However, the non-yielding Silver also attracts investors as the Federal Reserve (Fed) is highly expected to deliver atleast a 25-basis point rate cut in September. According to the CME FedWatch Tool, markets are now fully anticipating at least a quarter-basis point (bps) rate cut by the Federal Reserve at its September meeting. Additionally, Fed Chairman Jerome Powell stated at the Jackson Hole Symposium on Friday, “The time has come for policy to adjust.” Although Powell did not specify when rate cuts would begin or their potential size, he noted that job market risks have increased while inflation risks have decreased. The price of the safe-haven Silver gained ground due to concerns about escalating conflict in the Middle East. Hezbollah launched hundreds of rockets and drones into Israel on Sunday, prompting a response from the Israeli military, which deployed around 100 jets to strike Lebanon to prevent a larger assault. This escalation heightens concerns that the ongoing Gaza conflict could expand into a broader regional conflict, potentially involving Hezbollah’s supporter, Iran, and Israel’s primary ally, the United States, according to Reuters. Silver demand could be impacted by recent data from China’s National Bureau of Statistics, which indicates a struggling economy in the world’s largest manufacturing hub. As Silver plays a crucial role in various industrial applications, this downturn in industrial activity could pose significant challenges to its demand. Silver FAQs Silver is a precious metal highly traded…
Filed under: News - @ August 26, 2024 5:10 am