Spot Silver edged down on Thursday, while the US Dollar rebounded from a nearly 8-month low ahead of a speech by Federal Reserve Chair Jerome Powell at the Jackson Hole economic symposium that may provide more insight into potential interest rate cuts.
Meanwhile, the minutes of the Federal Reserve’s July meeting signaled that monetary easing was likely to begin in September.
The minutes stated if economic data continued to align with expectations, a rate cut next month would probably be appropriate.
Some FOMC policy makers leaned towards a rate cut during the July meeting, highlighting recent improvements in inflation and an uptick in unemployment.
Since short-term interest rates in the US are higher, market players expect an easing cycle in the US will need to run further compared to other major economies. This has driven US Treasury yields and the US Dollar lower.
Futures markets have already fully priced in a 25 basis point rate cut in September, with the chance of a 50 basis point cut being around 35%.
Bets on several rate cuts also mounted, after US Non-Farm Payrolls figures were revised down by 818,000 for the period between March 2023 and March 2024.
Markets continued to price in 100 basis points of Fed rate cuts by the end of this year.
As of 8:05 GMT on Thursday Spot Silver was losing 0.47% to trade at $29.467 per troy ounce.
Silver Futures for delivery in September were edging down 0.19% to trade at $29.480 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 up 0.10% to 101.220 on Thursday. Yesterday the DXY went down as low as 100.923, or a level not seen since December 28th 2023.
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