Silver is struggling for a clear direction with the price moving sideways a bit below $23 an ounce.
Investors are awaiting a fresh catalyst to drive the silver price with the bearish factors, such as the prospect of more interest rate hikes by central banks, offsetting the bullish ones, notably the strong fundamental case for the metal with demand outstripping supply.
Recent history has shown that the macroeconomic factors have tended to have an outsized impact on the silver price so the words and actions of the Federal Reserve and its officials will be closely scrutinised in the run up to the interest rate committee’s meeting later this month.
So far the US economy has proven fairly resilient in the face of the Fed’s series of interest rate hikes over the last year or so and this has been helpful for silver too with the boost it has given to industrial demand for the metal. However, while the long-term picture remains attractive for silver, the short-term one in which the Fed is set to hike in both July and potentially September imposes a strong ceiling on any gains for the metal for the time being.
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