The price of silver (XAG/USD) has dropped below $51.50 per troy ounce during European trading hours on Thursday. This decline comes after modest gains in the previous session, as a stronger US Dollar (USD) puts pressure on the precious metal.
The Greenback's strength is driven by growing hawkish sentiment around the Federal Reserve's policy outlook. Hotter-than-expected US Consumer Price Index (CPI) inflation data has fueled expectations of a December rate hike. Fed Governor Christopher Waller's comments earlier this week supported this view, with markets now pricing in a nearly 91% probability of a rate increase, according to the CME FedWatch Tool.
Traders are now focusing on key US economic data, including weekly Jobless Claims, existing home sales, and producer inflation figures, for further insights into the Federal Reserve’s monetary policy trajectory.
Technical analysis shows silver trading at $51.40, maintaining a bearish near-term bias. The price remains below both the nine-period and 50-period Exponential Moving Averages (EMAs), indicating short- and medium-term trend resistance. The 14-day Relative Strength Index (RSI) at 38.21 suggests persistent downside pressure, while the elevated FXS Fed Sentiment Index at 145.61 reinforces tightening policy expectations that continue to weigh on silver prices.