Risk-Off Dominates, Silver Maintains Momentum
Silver (XAG/USD) continued its upward trajectory into Monday's US session, above $48.5 troy ounces, following gold's rally to a new record above $3,900/oz amid expectations of a Fed rate cut and growing macroeconomic concerns. Flight-to-safety sentiment remained dominant as the US government shutdown continued, leading to fluctuating yields and a preference for safe-haven assets supporting the white metal. However, its movements remained volatile amid uneven liquidity.
On the bearish side, a strengthening US dollar limited silver's progress. The euro came under pressure after the French prime minister resigned, fueling fiscal concerns and widening yield spreads, while the yen weakened sharply following Sanae Takaichi's victory as LDP leader—both of which boosted the USD in the forex market. At the same time, some traders remained betting on a Fed rate cut this month, maintaining the appeal of non-interest-bearing precious metals despite the relatively strong dollar.
Looking ahead, market focus will be on comments from Fed officials, dollar dynamics, and flows into silver/gold-based instruments. Structurally, the 2025 outlook remains constructive: silver briefly hit a 13-year high in mid-year, supported by a supply deficit and industrial demand (including solar and electronics). As long as the dollar doesn't strengthen sharply and expectations of monetary policy easing remain, upside room remains open—although the risk of short-term profit-taking needs to be addressed.
Source: Newsmaker.id
