Silver Prices Whipsawed by US Factory Boom and Gulf Tensions
Silver prices saw significant fluctuations on Tuesday as two distinct market forces converged. The metal's industrial demand story received a boost from the Institute for Supply Management's manufacturing purchasing managers' index, which surged to 55.6 in July. This marked the strongest US factory expansion since May 2022 and reflected positively on silver's physical offtake.
However, the same robust economic data also complicated the Federal Reserve's policy path, increasing the likelihood of a rate hike in September. Higher interest rates are typically unfavorable to precious metals like silver, which pay no yield and compete with interest-bearing assets.
The technical setup for silver remains fragile, with the metal trading roughly six percent below its 50-day moving average. Analysts flag $57.00 as a critical support level that has recently unleashed fresh buying interest.