The rally may slow as traders await clearer Fed policy signals. Focus will be on the FOMC meeting minutes and key US economic data, including the ADP employment report and ISM Services PMI.
US Economic Data and Its Impact on Silver Prices
The US dollar has strengthened, driven by robust labor market data exceeding expectations, tempering investor expectations for a September Fed rate cut. Strong economic indicators reduce immediate pressure for monetary easing. However, markets still anticipate a potential rate cut in September and another in December.
Investors remain cautious, awaiting clarity on the Fed’s stance regarding rate cuts. Fed Chair Jerome Powell has noted progress on inflation but emphasized the need for sustained movement toward the 2% target before considering rate reductions.
JOLTs job openings increased from 7.919 million in April to 8.140 million in May, surpassing expectations of 7.910 million. This indicates a strengthening labor market, potentially boosting wages and disposable income. Increased disposable income could stimulate consumer spending, contributing to demand-led inflation pressures.
The strengthened US dollar and robust economic data may curb immediate silver price gains, but improved consumer spending could support industrial demand and inflation pressures, benefiting silver in the longer term.
Short-term Forecast
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