Spot Silver surged to a fresh one-week high of $51.76/oz. on Tuesday, as remarks by Federal Reserve policy makers renewed prospects of an interest rate cut next month.
Fed Governor Christopher Waller said on Monday that the US job market was weak enough to warrant another 25 basis point rate cut in December. Yet, policy action beyond that will depend on upcoming macro data that has been delayed by the government shutdown.
Waller’s remarks followed dovish comments by New York Fed President John Williams last week. He said that a near-term rate cut remained possible, with labor market weakness posing a higher risk than elevated inflation.
At the same time, other Fed officials have signaled reticence on further rate cuts. Dallas Federal Reserve President Lorie Logan called for keeping borrowing costs on hold “for a time”.
Markets are now pricing in about an 81% chance of a 25 basis point Fed rate cut in December, compared to a 50% chance a week earlier.
Spot Silver was last up 0.29% on the day to trade at $51.51 per troy ounce.
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