Prospects of Interest Rate Cuts & Weak Dollar Boost Silver Prices
Silver prices strengthened on Monday, posting significant gains amid growing global uncertainty and expectations of looser monetary policy in the United States, as well as a potential US government shutdown. Silver reached $47.18 per troy ounce, up nearly 1.9%, although it pared its gains to close at $46.89. This positive performance confirmed silver's bullish trend throughout September and strengthened its position as a safe-haven asset sought by investors.
The primary driver of silver's rally came from the increasingly open prospect of a Federal Reserve interest rate cut. The weakening US dollar in global markets also supported the rally, as silver became less expensive for holders of other currencies. In addition to monetary factors, rising industrial demand—particularly from the renewable energy, electric vehicle, and electronics sectors—pushed the price of this white metal to higher levels. At the same time, limited global supply intensified upward price pressures.
However, several analysts believe this sharp rise has the potential to trigger short-term profit-taking. The market is awaiting the release of US non-farm payroll data at the end of the week, which could signal the Fed's next policy direction. If the economic data shows stronger-than-expected resilience, silver could face corrective pressure. However, overall, the medium- to long-term trend is still considered positive as long as geopolitical uncertainty and the risk of a global economic slowdown remain high.
Source: Newsmaker.id
