Risk-Off Rising, Silver Weakens
Silver prices remained under pressure on Wednesday, settling at $48.42/oz, down around 0.3% amid a combination of a strengthening US dollar and rising Treasury yields that dampened interest in zero-coupon assets. The "higher-for-longer" tone from Fed officials kept policy expectations tight, increasing the opportunity cost of holding precious metals. Pressure also came from gold's continued correction after its previous sharp rally, triggering profit-taking across the precious metals complex and dampening short-term speculative sentiment.
On the fundamental side of demand, signals remain mixed. The industrial outlook for China—a major consumer of silver for electronics and solar panels—remains fragile despite policy support, while European manufacturing activity has yet to fully recover. On the other hand, the medium-term theme for silver remains constructive thanks to expanding solar energy capacity, vehicle electrification, and demand for solder/semiconductor components. Flows into silver ETFs have tended to thin in recent weeks, indicating caution, while futures positioning data indicates a reduction in net longs by speculators.
Going forward, silver's direction will be determined by the release of US inflation, global PMI data, and news of Chinese stimulus. A strengthening dollar risks prolonging pressure, but a more benign data surprise or a signal of policy easing could trigger short covering. Technically, market participants are monitoring the support area near the most recent swing low; a clear break opens room for further correction, while a buying reaction in that area could trigger a tactical rebound toward the nearest resistance.
Source: Newsmaker.id
