Silver Price Sinks Below $66 as Rate Hike Bets Soar

The silver price (XAG/USD) has dipped below $66.00 and is hinting at a bearish 'Head & Shoulders' formation, according to technical analysis.

This comes as precious metals struggle on Monday following the release of US Nonfarm Payrolls (NFP) figures last Friday, which showed a 162K increase in net employment in August, well above the 57K forecasted by market analysts. This has boosted hopes that the US Federal Reserve (Fed) will hike rates next week, with investors ramping up bets on a Fed rate hike at the September 15-16 monetary policy meeting to a 58% chance, from around 50% before the release.

Analysts at ING point to Friday's August Consumer Price Index (CPI) release as the main focus this week, where they see 'month-on-month readings at 0.4% and 0.2% for headline and core inflation' that could sway the Fed towards a 25bp rate hike on 16 September.