Silver: Profit-Taking vs Easing Prospects
Silver prices (XAG/USD) continued to correct in Asian trading after rallying to multi-year highs, trading in the $41.5–$41.8/oz range in recent trading. Selling pressure emerged after the euphoria surrounding the Fed's interest rate cut subsided, and the market reconsidered the direction of the US dollar. On a daily basis, silver performance weakened by around 1–2% compared to the previous session, in line with the release that saw XAG briefly fall to around $41.50.
From a policy perspective, the Fed cut interest rates by 25 bps to 4.00%–4.25% and signaled a continued easing path through projections (dot plots) pointing to a range of 3.5%–3.75% by year-end. This narrative depressed real yields and fundamentally supported non-yielding metals like silver, although the effect was tempered if the Fed's tone was perceived as less dovish.
Money market factors remain crucial: The DXY briefly dipped to a multi-year low but managed to stabilize as Powell emphasized inflation risk management—making silver sentiment volatile. Globally, the widespread trend of monetary easing (e.g., the Bank of Canada's 25 bps rate cut to 2.5%) is supporting the safe-haven narrative, but upcoming US data and the dollar's direction will determine whether silver retests the peak or continues consolidating within its current range.
Source: Newsmaker.id
