Spot Silver registered a fresh 14-year peak of $43.79/oz. on Monday on expectations the Federal Reserve will continue easing its monetary policy even as the US economy remains resilient.
The Fed lowered its federal funds rate target range by 25 basis points to 4.00%-4.25% at its September meeting and indicated another 50 basis points of rate cuts by the end of the year.
Fed Chair Jerome Powell described the September policy action as a risk-management cut addressing the weakening labor market.
Powell also noted the US central bank was in a “meeting-by-meeting situation” in regard to the rate outlook.
Markets are now pricing in about a 92% chance of another 25 basis point Fed rate cut in October.
Lower interest rates tend to reduce the opportunity cost of holding Silver, which pays no interest.
Additionally, robust industrial demand continued to support Silver prices amid supply constraints. Silver is facing its fifth successive year of a structural market deficit.
Spot Silver was last up 1.24% on the day to trade at $43.61 per troy ounce.
Meanwhile, Silver futures for December delivery were last up 2.66% to trade at $44.094 per troy ounce.
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