Silver Surges 1.8% on Pause in Oil Prices
The price of Silver (XAG/USD) has surged to nearly $64.40 during Thursday's European trading session, up 1.8% from previous levels. The metal's gain comes as oil prices hit a temporary pause after Saudi Arabia confirmed it was exploring alternative shipping methods for energy exports.
However, the Federal Reserve's (Fed) decision on interest rates has tempered expectations of further upside in Silver. Policymakers hiked interest rates by 25 basis points to 3.75%-4.00%, signaling a higher-for-longer policy bias and potentially limiting gains for non-yielding assets like Silver.
Strategists at NBC Economics believe that the Fed's updated dot plot suggests a brief tightening cycle, with a peak target of 4.25% interest rates. While this could eventually lead to rate cuts, it underscores concerns about inflationary pressures and their impact on Silver prices.