Posted 17th January 2024

Silver Price News: Silver Slides On Strength in US Dollar, Treasuries

Silver prices fell back below the $23.00 an ounce mark on Tuesday, with precious metals markets in retreat after strength seen at the end of last week.

Prices fell as low as $22.88 an ounce on Tuesday, compared with highs of around $23.35 an ounce on Monday.

Both gold and silver were lower, pushed down by strength in the US dollar and rising Treasury yields. The markets have been scaling back bets on a US Fed interest rate cut in March, with any longer timeframe at current rates seen as bearish for silver.

That said, data from interest rate traders still indicate a 65% expectation that the Fed will cut rates by 25 basis points at its March meeting, which could support non-interest-bearing assets like precious metals.

Looking ahead, monthly US Retail Sales and Industrial Production figures are due on Wednesday, giving the latest snapshot on the health of the US economy.

In addition, ECB chief Christine Lagarde is set to speak later in the afternoon, providing a window into the central bank’s outlook for monetary policy. The EU bank has maintained interest rates at 4.5% since October, following a series of aggressive hikes since mid-2022.

It remains unclear what the timescale may be for any cuts. The ECB has said it expects inflation to fall to 2.7% in 2024 from 5.4% in 2023. This could allow a more accommodative stance on interest rates, which should support precious metals prices.

Frank’s experience covering the commodities markets spans 22 years, with a particular specialism in metals, carbon and energy markets. He has worked as a senior editor for S&P Global Commodity Insights (formerly Platts) and before this, at ICIS-LOR, a part of Reed Business Information (Reed Elsevier), where he covered the petrochemicals markets from 2003 to 2005.

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