Silver Forecast: Key PPI Data May Shape Market Sentiment

Market Overview

Silver prices (XAG/USD) are trading at $31.23, gaining momentum as the US dollar weakens. This bullish trend is fueled by growing expectations that the Federal Reserve may implement further interest rate cuts due to a softening labor market. A weaker dollar makes silver more attractive to investors, driving demand and lifting prices. Despite stronger-than-expected US inflation figures, the possibility of additional rate cuts remains a significant factor supporting silver’s positive momentum.

Market Focus Shifts to US PPI Data and Its Impact on Silver Prices

Investors are now awaiting the US Producer Price Index (PPI) report, which could influence dollar demand and impact silver prices. A higher-than-expected PPI reading might strengthen the dollar and limit silver’s gains, while a softer PPI could weaken the dollar and provide additional support for silver prices.

Recent Inflation Data Review

• The recent Consumer Price Index (CPI) data showed a year-over-year increase of 2.4%
• Core CPI, which excludes food and energy, rose by 3.3%

This stronger inflation data has created uncertainty around the pace of future rate cuts, making the upcoming PPI report crucial for market sentiment.

China’s Fiscal Stimulus and Its Potential Impact on Silver Demand

Market participants are also closely watching developments in China, where new fiscal stimulus measures are expected to be announced this Saturday. If the stimulus leads to economic growth, it could boost industrial demand for silver, a key component in the manufacturing and technology sectors. However, the announcement could also temper significant short-term price increases as investors await more details. This cautious sentiment may cap silver’s gains in the immediate future.

Overall, while silver maintains its bullish trend, investors should remain vigilant about upcoming economic data and global developments that could impact price stability.

Short-Term Forecast

Silver (XAG/USD) is trading at $31.17, driven by a weaker US dollar and potential Fed rate cuts. Investors should monitor the upcoming US PPI data, which could impact silver’s momentum.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver (XAG/USD) is currently trading at $31.23, up 0.25% on the day. The price is holding above its pivot point at $31.22, indicating strong bullish momentum. Immediate resistance stands at $31.55, and a sustained break above this level could propel the price toward the next resistance at $31.88 and potentially $32.35. On the downside, immediate support is seen at $30.81, followed by deeper support levels at $30.46 and $30.13. The 50-day Exponential Moving Average (EMA) of $31.04 offers short-term support, while the 200-day EMA at $31.06 indicates long-term stability. The overall technical outlook remains bullish as long as silver stays above $31.22. However, a drop below this pivot could trigger a sharp selling trend.