Spot Silver was little changed at the start of the week, as subsiding inflation in the US added to prospects that the Federal Reserve would deliver a rate cut later this year.
Data showed last Friday that annual core PCE inflation had eased to 2.6% in May from 2.8% in April, while coming in line with market consensus.
It has been the lowest rate since March 2021.
“The latest U.S. inflation data remain fresh on investors’ mind, with the data coming in line with consensus and generally did little to sway current market rate expectations for the Fed’s easing process to kickstart in September,” IG market strategist Yeap Jun Rong was quoted as saying by Reuters.
Markets are now pricing in about a 63% chance of a Fed rate cut occurring in September, according to the CME FedWatch tool.
Lower interest rates reduce the opportunity cost of holding Silver, which pays no interest.
Market players will next be paying close attention to remarks from Fed Chair Jerome Powell on Tuesday and to the minutes from the Federal Reserve’s most recent policy meeting due out on Wednesday.
As of 6:58 GMT on Monday Spot Silver was inching down 0.02% to trade at $29.138 per troy ounce.
The commodity registered a 1.37% loss last week.
Silver Futures for delivery in September were losing 0.41% to trade at $29.438 per troy ounce.
The US Dollar Index, which reflects the relative strength of the greenback against a basket of six other major currencies, was edging down 0.36% to 105.465 on Monday.
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