The silver spot price has managed to return above $19, confirming the recent signals of stabilisation and consolidation after the decline seen in the third week of August.
In the last few months, silver suffered from both the strength of the U.S. dollar and fears of a global recession. In fact, a significant part of the demand for this precious metal is coming from the industrial sector (such as photovoltaics and electric cars).
Another crucial market driver has been the monetary policy enacted by the Federal Reserve. Indeed the U.S. central banks raised interest rates several times to contrast the growing rate of inflation. There’s now a lot of attention on today’s speech from Jerome Powell in Jackson Hole.
The global central bankers meeting hosted by the Federal Reserve this year is focusing on “Reassessing Constraints on the Economy and Policy”. Investors are waiting to discover some further insights about the next decisions made by the U.S. Central bank concerning monetary policy. His speech is due at 10 a.m. E.T (4 p.m. central Europe time), with the headline “The Economic Outlook” offering no further insight into what’s to come.
Any dovish output – and even more any signals of a pause in the rate hikes – could represent a positive catalyst for the silver price. However, a strong hawkish view could be seen as a negative driver for both stocks and commodities.
Carlo Alberto De Casa is an external Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. Carlo provides regular commentary for UK notable outlets including the BBC, Telegraph, The Independent, Bloomberg, FX Empire and Reuters.
With a credential background in Economic Finance and International Exchange (MA), his critical analysis on gold and silver’s markets performance is frequently quoted by leading publications, week-on-week.
This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.
