Silver Price Targets $66.50 Ahead of PCE as Fed Hike Risk Lingers

Silver's price is expected to reach $66.50 ahead of the upcoming PCE inflation data, but its post-meeting surge may be limited due to a persisting risk of another Fed hike. The COMEX market, despite being thin, carries a substantial notional value of $32.77 billion.

A recent analysis of CFTC reports shows that silver's quarter-end book ranks as the eighth thinnest among 507 reports by contracts but the 51st largest by dollars. However, historical data suggests that this market condition does not necessarily lead to significant price movements.

Backtesting the thin-book screen on every weekly report since 2017 found no reliable effect of Fed increases on silver's price. Given this pattern, a base case is established for a rise of under 1% to $66.50 by October 16th.