Dollar Dampens Silver's Inflation-Fueled Rally

Silver's attempt to shine was met with a stubborn dollar that refused to budge. Despite a softer-than-expected Consumer Price Index (CPI) and a flat Producer Price Index (PPI), which pushed September Fed hike expectations lower and Treasury yields down, silver failed to hold above $66.80.

The spot price of XAG/USD touched $66.80 after the inflation data was released. However, this brief spark was extinguished as the dollar remained near recent highs, capping the upside in silver.

According to market analysis, silver has only half of the rate-relief trade working. Lower yields support the metal, but a resilient dollar is preventing it from reaching its full potential.