Silver Price Holds Firm Amid Expectations of Another Rate Hike

Silver (XAG/USD) is holding firm on Friday, despite being on track for a weekly loss. The US Dollar's modest pullback after its strong weekly rally has offered some relief to Silver.

However, the upside remains limited as markets raise bets on another Federal Reserve rate hike. This would increase borrowing costs and weigh on non-yielding assets like Silver, making interest-bearing assets more attractive.

The CME FedWatch Tool shows around a 66% probability of another rate increase at the October meeting, which could influence expectations. Next week's US Personal Consumption Expenditures (PCE) inflation report, ISM Manufacturing Purchasing Managers' Index (PMI), and Nonfarm Payrolls (NFP) data will be closely watched for any changes in sentiment.

Despite the fundamental headwinds, Silver's technical picture looks somewhat constructive. Momentum indicators are largely neutral, suggesting that neither buyers nor sellers have control as XAG/USD continues to move within a range established over the past month.