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Silver
Source: Newsmaker.id
Silver prices rallied sharply during Thursday's trading (Aug 27), hovering around US$69.50 per ounce—a gain of approximately 2.74%. The XAG/USD pair is now approaching the upper limit of this week's trading range as investors focus on the upcoming speech by Federal Reserve official Kevin Warsh at Jackson Hole.
Warsh's speech on Friday serves as a key catalyst, with the market seeking clues on how the Fed views persistent inflationary pressures and their impact on the interest rate trajectory. If Warsh reiterates the commitment to bringing inflation down to the 2% target, expectations for "higher-for-longer" interest rates could strengthen once again.
Recent PCE data indicates that US inflationary pressure remains above the Fed's target, though it has not yet shown a sharp acceleration. Markets currently price in a roughly 62% probability that interest rates will remain unchanged in September, making the future policy direction highly sensitive to comments from Fed officials.
A hawkish tone has also emerged from several Fed officials. Cleveland Fed President Beth Hammack believes inflationary pressures still require action, while Jeff Schmid of the Kansas City Fed warned that the impact of rising energy costs is beginning to filter through to the economy. Austan Goolsbee also views inflation that is not yet fully under control as the greatest short-term risk.
Hawkish comments could act as a headwind for silver, as they might drive the US dollar and Treasury yields higher. As a non-interest-bearing asset, silver tends to lose appeal when the opportunity cost of holding precious metals rises. However, uncertainty in the Middle East and issues surrounding the Strait of Hormuz continue to support safe-haven demand.
Newsmaker Analysis: Silver's momentum remains bullish, but the US$70 level represents a crucial psychological resistance point. If Warsh is not as hawkish as the market fears, silver could break through US$70 and extend its rally. Conversely, firm comments regarding inflation and potential tightening could trigger a strengthening dollar and profit-taking in silver. (arl)
Source: Newsmaker.id