Silver Steadies Near 7-Month Low

Silver steadied above $58 an ounce on Wednesday but remained near its lowest level in seven months as strong US economic data underscored the economy’s resilience and reinforced expectations that the Federal Reserve will raise interest rates this year. The latest JOLTS report showed job openings climbed to a two-year high, while analysts expect another solid increase in June non-farm payrolls. Meanwhile, recent core inflation readings remained well above the Fed’s 2% target. Markets are now pricing in at least one Fed rate hike this year, with the first potentially coming as early as September. Investors also awaited updates from the ongoing US-Iran peace talks in Qatar amid hopes for a lasting ceasefire agreement, although the two sides were not expected to hold direct talks.

Silver prices rose toward $60 per ounce, halting the plunge that bottomed at a seven-month low of $57 on June 24th, and outperforming gold in the last sessions as the outlook of strong industrial demand weighed against pressure from a restrictive Fed. Equities for chip producers and datacenter developers rallied for a second session to reflect long bets on the construction of compute capacity. The activity boosted the outlook of silver demand due to its use usage in AI infrastructure for its conductive nature. Still, the hawkish outlook for the Fed maintained pressure in assets that do not bear coupons. Strong labor market data and surveys pointing to higher inflation drove a large portion of the FOMC to project more restrictive rates this year. On top of that, fixed-income supply risked a decline as Fed Chairman Warsh campaigned for a lower Fed balance sheet, reversing the debasement trade from late 2025.

Silver prices hovered around $58 an ounce on Tuesday, near their weakest level since December 2025, with losses exceeding 20% for both the month and the quarter, as a firm US dollar and expectations of US interest rate hikes continued to weigh on the metal. Rising energy prices, fueled by the Middle East conflict, have eliminated expectations of Federal Reserve rate cuts this year, with traders now pricing in a near 65% chance of a September hike. Although precious metals are traditionally seen as inflation hedges, higher interest rates tend to pressure non-yielding assets like silver. Focus now turns to upcoming US employment data, including nonfarm payrolls, and remarks by Fed Chair Kevin Warsh due Wednesday for signals on monetary policy. Meanwhile, investors are monitoring prospects for renewed US-Iran diplomacy, though Iran has dismissed reports of talks in Doha this week as unfounded.