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Silver
Source: Newsmaker.id
Silver prices (XAG/USD) trended lower during Wednesday's trading (Oct 14), hovering around US$58.56 per troy ounce—a 1.06% drop from the previous session's level of US$59.18. This decline indicates a resurgence of selling pressure following a prior period of gains.
Silver's price action remains driven by US dollar dynamics and expectations regarding Federal Reserve interest rate policy. A relatively strong US dollar can weigh on precious metals by making silver more expensive for investors holding other currencies. Meanwhile, rising US bond yields can diminish the appeal of non-yielding assets like silver.
Investors are closely monitoring the Fed's policy trajectory amidst uncertainty surrounding US inflation. Data on the Consumer Price Index (CPI) and Producer Price Index (PPI) are in focus, as they can influence market expectations regarding interest rates. Higher inflation could reinforce expectations of rate hikes and exert additional downward pressure on silver prices.
On the other hand, silver differs from gold; beyond serving as an investment asset, it is widely used in industrial applications. Demand from the electronics, renewable energy, and manufacturing sectors could support prices if economic activity remains robust. However, a global economic slowdown could dampen industrial demand and limit upside potential.
Silver's movements must also be viewed in the context of the broader precious metals market. Should the US dollar and yields weaken, precious metals could see renewed buying interest. Conversely, a strengthening dollar and rising interest rate expectations could sustain pressure on the XAG/USD pair.
Newsmaker Analysis: XAG/USD is currently facing pressure stemming from a combination of the US dollar, bond yields, and uncertainty regarding the Federal Reserve's policy direction. The US$58 level is a key area to watch to see whether selling pressure persists or buying interest begins to emerge. In the short term, US inflation data serves as a crucial catalyst. Higher inflation could weigh on silver, whereas lower figures might pave the way for a rebound toward the US$59 area and a retest of higher levels.
Source: Newsmaker.id