Silver Clings to Gains Near $62 Ahead of NFP Data
The Silver price (XAG/USD) is holding its ground near $62.00 as investors await the US Nonfarm Payrolls (NFP) data for July. Lower oil prices, which have fallen to a three-week low of $73.51 on Wednesday, are keeping global inflation expectations in check and diminishing fears of interest rate hikes by central banks.
According to ING analysts, the market is pinning its hopes on a deal between the US and Iran that would resume energy flows through the Strait of Hormuz. While there has been some progress towards this goal, with Iran announcing an agreement with Oman on new shipping arrangements for the strait, investors remain cautious ahead of the NFP data.
TD Securities noted that the July ADP employment data 'surprised to the downside' and moderated to 44k, reinforcing their view that job growth is cooling after a strong start to the year. They stress that they do not put much weight on ADP when it comes to monthly moves in NFP.
The Silver price has reclaimed higher ground after its recent pullback, with momentum staying in mildly positive territory as reflected by the Relative Strength Index (14) at 55.71. However, initial support emerges at the 20-day exponential moving average (EMA) at $59.43, where a break would signal fading bullish pressure.