Silver is drifting along near $24 an ounce as the markets await the much-anticipated Federal Reserve interest rate decision later today.
Signs that US inflation is moving in the right direction have increased the likelihood of the Fed holding off on further interest rate rises to see the impact the current rates are already having. This expectation of a Fed pause has boosted equity markets and silver too with silver suffering a difficult last year or so in the face of the US central bank’s series of interest rate hikes.
Yet while a pause remains the likeliest outcome, investors seem reluctant to commit their money until confirmation lands. Holders of silver will be itching for the focus to move past what happens at the Fed and instead train their attention on the metal’s strong fundamental outlook that sees silver headed for another supply deficit this year.
So far silver’s bullish case has been overwhelmed by a negative macroeconomic environment but a pause today could be the catalyst silver needs to push the price higher and better reflect its true value in a world desperately in need of its highly conductive qualities to power the energy transition.
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