- Silver hit a six-month high at around $24.12 before reversing its curse, though it remains positive.
- Inflation in the United States continues its downtrend, still far from the 2% goal.
- The Federal Reserve is expected to hike rates by 50 bps, with odds around 90%.
Silver price advanced sharply above the $24.00 figure following the November inflation report in the United States (US) release, which ticked lower, easing pressure on the Federal Reserve (Fed). The US Dollar (USD) is plunging while precious metals advance. At the time of writing, the XAG/USD is trading at $23.74 after hitting an eight-month high of $24.12.
The Department of Labor reported that the Consumer Price Index (CPI) rose marginally by 0.1% from last month and decreased slightly on a year-on-year basis to 7.1%, missing previous analyst expectations of 7.3%. Even though inflation has dropped since its peak in June at 9.1%, the so-called core CPI suddenly shifted upwards during September. Nevertheless, in the last two months, core CPI moved downwards, with November figures standing at 6%, below what analysts had predicted as 6.3%.
Money market futures suggest that the Federal Funds rate (FFR) may reach a peak of 5% before being cut in September 2023, around 20 bps. At the same time, weakness was seen for the US Dollar Index, which sank to six-month lows around 103.586, though it is trimming some of its earlier losses, sitting at 103.900.
Elsewhere, US Treasury bond yields, namely the 10-year benchmark note rate, plunged 15 bps, from around 3.630% to 3.459%, while US 10-year TIPS yield, a proxy for real yields, dropped 11 bps to 1.215%, a tailwind for the precious metal segment.
Silver (XAG/USD) Reaction to US CPI report
XAG/USD remains upward biased and rallied above $24.00, on traders speculating that the Federal Reserve might not be as aggressive as inflation continues to slow down. Silver found solid resistance at the R4 daily pivot at $24.14, since then, retraced $0.40 towards current prices, erasing some of its earlier gains. A fall below the $2 daily pivot at $23.73 could pave the way toward the R1 level at $23.52, followed by the daily pivot at $23.31, which would turn the white metal flat compared to Tuesday’s opening price.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD remains bid around 1.1200, USD melts on tariff concerns
EUR/usd maintains its bullish stance well in place on Thursday, reaching the 1.1200 barrier and beyond on the back of intense selling pressure on the US Dollar, fuelled by concerns over the impact of Trump's tariffs on the US economy.
GBP/USD settles around 1.2950 on weaker Dollar
GBP/USD advances markedly and extends its breakout of the 1.2900 hurdle amid global trade war jitters and a severe sell-off in the Greenback, which was exacerbated following news of 145% US tariffs on China.
Gold resumes record rally, reaches $3,175
Gold extended its record rally on fresh tariff-related headlines, trading as high as $3,175 a troy ounce in the American session. The White House confirmed 35% levies on Mexico and Canada, 145% on Chinese imports, resulting in a fresh round of USD selling and pushing XAU/USD further up.
Cardano stabilizes near $0.62 after Trump’s 90-day tariff pause-led surge
Cardano stabilizes around $0.62 on Thursday after a sharp recovery the previous day, triggered by US Donald Trump’s decision to pause tariffs for 90 days except for China and other countries that had retaliated against the reciprocal tariffs announced on April 2.
Trump’s tariff pause sparks rally – What comes next?
Markets staged a dramatic reversal Wednesday, led by a 12% surge in the Nasdaq and strong gains across major indices, following President Trump’s unexpected decision to pause tariff escalation for non-retaliating trade partners.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.