Silver Price Plunges as Fed Hike Expectations Soar to 87%

The price of silver (XAG/USD) has fallen to around $63.50 per troy ounce on Monday, as market expectations for a September Fed rate hike rose to 87%.

This comes after hotter US inflation data showed the Consumer Price Index (CPI) rose 0.4% month-on-month in August, with annual inflation hitting 3.4%, and core figures beating forecasts by 0.2%.

The Fed's potential rate hike has put pressure on non-yielding assets like silver, which is now facing significant headwinds from rising expectations of tighter monetary policy.

Oil prices have also surged toward four-month highs due to escalating Middle East tensions and a Saudi pipeline shutdown, further impacting the global economy and inflationary pressures.