Silver Soars, US Shutdown a Trigger
Silver prices surged sharply above $48.3 per ounce on Monday, reaching their highest level since April 2011. This surge was triggered by the ongoing US government shutdown, which has driven the market towards safe-haven assets like silver. Furthermore, expectations of an interest rate cut by the Federal Reserve also boosted buying interest, as investors anticipated monetary easing measures to ease economic pressures.
The prolonged US government shutdown prevented lawmakers from reaching a funding agreement, resulting in the suspension of several federal programs and the delay of key data, such as the September employment report. The market is now almost fully anticipating a quarter-point Fed rate cut this month, with the possibility of an additional cut in December. Investors are also awaiting statements from Fed Chairman Stephen Miran and Chairman Jerome Powell, scheduled for Wednesday and Thursday, for clues on the next policy direction.
In addition to macroeconomic factors, silver prices are also supported by tightening supply conditions. The Silver Institute projects the global silver market will experience a deficit for the fifth consecutive year by 2025, adding upward pressure on the price of this precious metal. With the combination of political uncertainty in the US and supply pressures, silver is expected to continue to be a favorite hedge among investors. (az)
Source: Newsmaker.id
