Silver prices finished with a 0.16% gain, settling at 70594, as the US dollar or bond yields fell from current highs, countering hawkish remarks from the Federal Reserve (Fed) officials.
Following remarks from Minneapolis Federal Reserve Bank President Neel Kashkari, who emphasised fewer risks to the United States economy and gave the central bank leeway to reevaluate rate adjustments, traders revised their expectations for aggressive rate cuts. Austan Goolsbee of the Chicago Fed agreed, highlighting the significance of positive inflation data.
The US labour market’s strength and the Manufacturing the purchasing manager’s Index (PMI) data for January. Along with the Services PMI’s outperformance, further bolstered the country’s strong economic outlook.
The Services PMI, which accounts for 2 thirds of the United States economy, increased to 53.4, above the previous reading and forecasts. With a sub-index for new orders of 55.0 compared to an estimate of 52.8. It was clear that there was a healthy order book for 2024.
Gold prices may be further pressure by geopolitical developments.. Such as expectations of a ceasefire between Palestinians and Israelis in Gaza.
Federal Reserve Governor Michelle Bowman. While highlighting the positive indicators of decreasing price pressures. Issued a warning against rate cuts that come too soon as they could cause a delay in meeting the 2% inflation target.
Technically speaking, there was new buying in the silver market, as evidenced by a 0.23% rise in open interest and a 114 rupee price increase that resulted in the market closing at 3234.
Silver prices resistance is probably at 70780, and a breakout could take it as high as 70965. Support is found at 70355, with a test of 70115 possible.