- Silver is trading with slight losses around $28.25 in early Asian trading on Thursday.
- US nonfarm payrolls (NFP) for August will be in focus on Friday.
- The rebound in the USD and pessimism about Chinese growth drag the price of Silver lower, but strong bets on a Fed rate cut could limit its fall.
Silver (XAG/USD) is trading with a slight bearish bias near $28.25 on Thursday during the early Asian session. The modest recovery in the US Dollar (USD) is weighing on the white metal. However, growing speculation that the US Federal Reserve (Fed) will cut interest rates deeper at its next meeting later this month could help limit silver’s losses.
The weak US JOLTS report released on Wednesday raised the odds of a 50 basis points (bps) rate cut by the Fed. According to the CME FedWatch tool, which acts as a barometer of market expectations on the federal funds target rate, the probability of the Federal Reserve (Fed) cutting rates by 25 basis points (bps) at the September meeting is 57%, while the odds of a 50 bps cut is 43%. The looming Fed rate cuts could limit the precious metal’s downside in the near term as it makes XAG/USD cheaper for most buyers.
US Non-Farm Payrolls (NFP) for August will be in focus on Friday, with the US economy expected to add 161,000 jobs. In case of a weaker result, this could put some selling pressure on the Dollar and lift the price of USD-denominated Silver.
On the other hand, pessimism over China’s growth and demand concerns could undermine the white metal as China is the world’s top exporter of silver. Analysts at Bank of America Global Research cut China’s GDP growth forecasts from 5.0% to 4.8% in 2024. Meanwhile, China’s discouraging Caixin Services PMI contributes to the downside, falling to 51.6 from 52.1 in July.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
