Silver prices (XAG/USD) continued their upward trend for the second consecutive day, trading near $29.50 per troy ounce during the Asian trading session on Friday. The increase in silver’s value is attributed to the lower opportunity cost associated with non-yielding assets, as market expectations for a U.S. Federal Reserve interest rate cut in September grow.
Investors are eagerly awaiting the release of the U.S. Personal Consumption Expenditure (PCE) Price Index for July, which is set to be announced later in the North American session. The data will provide insights into future U.S. interest rate movements.
Federal Reserve Atlanta President Raphael Bostic, known for his hawkish stance on the Federal Open Market Committee (FOMC), suggested on Thursday that it may be “time to move” on rate cuts. This stance is due to cooling inflation and a higher-than-expected unemployment rate. However, Bostic has indicated he will wait for further confirmation from upcoming job reports and inflation data before the Fed‘s September meeting.
On the geopolitical front, safe-haven assets like silver may face challenges. Israel and the Palestinian militant group Hamas have agreed to three-day ceasefires in Gaza to facilitate the first round of polio vaccinations for 640,000 children, according to a senior WHO official, as reported by Reuters.
Additionally, Reuters reported that Israeli forces killed a local commander of the Iranian-backed Islamic Jihad movement along with four other militants in the West Bank on Thursday. This incident, part of one of the largest assaults in the Israeli-occupied territory in months, marks a significant escalation in the ongoing conflict.
