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Silver falls below $57 as Fed outcome keeps investors cautious

XAG/USD is trading near $56.90, down 0.43% on the day, with futures still pricing about a one-in-three chance of a 25 basis-point Fed hike.

Reported · Written up by our desk · Precious Metals

Silver prices slipped to trade around $56.90, falling 0.43% on the day, as investors stayed cautious ahead of a Federal Reserve monetary policy decision, FXStreet reported.

The Fed is widely expected to keep its benchmark interest rate unchanged in the 3.5% to 3.75% range for a fifth straight meeting, but futures markets are still pricing roughly a one-in-three chance of a 25 basis-point hike, keeping uncertainty elevated around the US inflation outlook.

FXStreet said attention will center on Fed Chair Kevin Warsh's press conference for clues on the future path of policy. Any signals that the Fed remains concerned about inflation, or is willing to tighten further, could strengthen the US dollar and weigh on silver, which does not pay yield.

The outlet also pointed to heightened geopolitical tensions after the US said it would carry out further strikes against Iran following attacks targeting US positions in Jordan. While that has supported oil prices, the market focus is on how higher energy costs could keep inflation elevated, reinforcing expectations that the Fed may maintain restrictive policy longer.

Latest closeSilver $57.33 ▼2.0%

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