Silver Price Plunges on Fed Hike Expectations
The Silver price (XAG/USD) has fallen for the second consecutive day, trading around $63.20 per troy ounce during Asian hours on Tuesday.
The decline is attributed to rising oil prices and heightened expectations of a US Federal Reserve interest rate hike due to intensifying inflation concerns.
Rising energy costs have led to increased pressure on the Fed to tighten monetary policy, with money markets surging on Monday to reflect an over 92% chance of a rate hike, up from roughly 60% just a week prior based on data from the CME FedWatch tool.
Friday's economic data revealed that the US Consumer Price Index (CPI) rose in August, with core inflation recording its largest gain in four months. The US 10-year Treasury yield surged toward 5%, placing additional downward pressure on non-yielding precious metals like Silver.