Silver saw an increase of 0.84%, closing at 72377, as a result of buyers seeking refuge in the metal after three US soldiers were killed in a terrorist attack in Jordan. Notwithstanding the possibility of a recession, the European Central Bank (ECB) declared its intention to keep interest rates low and pledged to keep them restrictive for as long as it takes to fight inflation.
The Bureau of Economic Analysis (BEA) in the United States revealed faster-than-anticipated economic growth, with the economy gaining 3.3% annually, above the market’s 2% estimate. The United States economy appears resilient as evidenced by the 4.9% significant increase in GDP for the July-September quarter.
Because of this positive data, policymakers are likely to view the Federal Reserve’s (Fed) consensus argument for early interest rate cuts as questionable, considering rate cuts starting in March to be “premature.” The public’s sense of risk aversion increased after a drone strike in Jordan claimed the lives of three US soldiers.
President Biden promised an American response. The current drop in 10-year Treasury yields provided additional support for silver prices ahead of this week’s Federal Reserve policy meeting.
Technically, short-covering is taking place in the market as evidenced by the 12.09% decline in open interest to close at 23368, despite a 604 rupee increase in prices.
The support level for silver is 71870; a break below this level could take it as high as 71365. If prices move above the likely resistance level of 72715, they may test 73055 on the upside.