- Silver price falls near $31.60 with US core PCE taking center stage.
- The US core PCE price index accelerated to 2.7% in August year-on-year.
- Investors expect the Fed to cut interest rates by an additional 75 bps in the remainder of the year.
Silver price (XAG/USD) extends its correction near $31.60 in the European session on Friday after facing selling pressure from new highs of $32.70 on Thursday. The white metal is under pressure as investors turn cautious ahead of United States (US) Personal Consumption Expenditure (PCE) Price Index data for August, due at 12:30 GMT .
Economists estimate that the price index of PCE Core inflation, a preferred measure of inflation by the Federal Reserve (Fed), has grown 2.37%, faster than 2.6% in July, with monthly figures rising steadily by 0.2%. Investors are looking forward to US inflation data as it will shape market speculation on the Fed’s likely policy action in the final quarter of this year.
According to the CME FedWatch tool, the central bank is expected to further reduce its key interest rates by 75 bps in the remaining two meetings this year, suggesting that there will be a 50 bps cut and a 25 bps cut. 30-day fed funds futures price data shows traders are evenly divided on a 25 or 50 bps rate cut in November.
Meanwhile, the US Dollar Index (DXY), which tracks the value of the dollar against six major currencies, trims its early gains and remains above 100.50. US 10-year Treasury yields fall to 3.79%.
Silver technical analysis
Silver price falls slightly after posting a new decade high near $32.70. The white metal is under pressure ahead of key inflation data. However, its short-term outlook is bullish as all short-term to long-term exponential moving averages (EMAs) are on an upward slope.
The 14-day Relative Strength Index (RSI) is oscillating in the bullish range of 60.00-80.00, suggesting strong bullish momentum.
Silver daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
